Bank of Tanzania said in its Consolidated Zonal Economic Performance Report for the year ending December 2019, that the banks investment and adaptation of new digital platforms and agent banking played a key role in the growth.
The report stated that in addition to physical branches which are mainly based in urban areas, investment in alternative channels facilitated mobilization of deposits and thus enabling banks to increase deposits which were used to issue loans to both the public and private sectors.
“The deposits mobilization improved during the period under review partly on account of increase agent banking, improved efforts in digital deposits mobilization and the ordinary branch banking,” reads part of the report.
The report further noted that Dar es Salaam zone had the most contribution with a share of 64.4 percent, while South Eastern zone accounted for the least share at only four percent.
Details of the central bank report shows that Dar es Salaam’s deposits amounted to 13.01trn/- followed by Northern zone covering Arusha, Kilimanjaro and Manyara with 2.50trn/- while Central zone which consists of Dodoma, Singida and Tabora mobilized deposits worth 1.57trn/-. The South Eastern zone had only mobilized 781bn/-.
As a result of the good deposits mobilization, loans and advances made by banks to various sectors of the economy grewby2.2 percent to 14.51trn/- compared to 14.2trn/- extended in the last quarter of 2018.
“The highest growth of bank loans was recorded in Central and Lake Zones, consistent with expansion of construction and trade activities. Out of the outstanding stock, 66.1 percent of the total loans were directed to personal, trade and agriculture activities,” the report noted.
The central bank further noted that the financial sector remains stable and promising for the future thanks to professionalism and huge investments being made in alternative banking channels.
Meanwhile, the number of Savings and Credit Cooperative Societies (SACCOs) decreased from 4,177 registered at the end of December 2018 to 3,714 by December 2019. The BoT report stated that despite the decrease in the number of SACCOs, the total number of members, share values, value of deposits, savings, loans issued and outstanding loans increased.
“Number of members increased to 711,507 from 620,616,share value increased to 57.06bn/- from 53.64bn/-, savings increased to 200.21bn/- from 176.48bn/- compared to that registered in the corresponding period in 2018. Deposits topped 51.6bn/- from 39.54bn/-.” The central bank’s quarterly report added.