The integration is in response to the government directive to embark on electronic payments as a way of increasing transparency and raise revenue collection within the local government authorities.
Speaking at the launch in Dodoma over the weekend, Prime Minister said the government is determined to improve the revenue collection systems within local government authorities.
“We have chosen to use NMB in electronic revenue collection because they are capable and above all, it is a government bank. Whatever we put in NMB, we know that we get something in return through dividends,” said the PM.
Majaliwa pointed out that for the last 17 years, the government has been empowering councils on revenue collection, but they have not been able to manage their revenues including their capacity to collect revenue. The main challenge in councils is the revenues collection leakages.
“I am taking this opportunity to insist that all councils revenue must be managed and collected through electronic systems; this has been proven to be the most effective way and will solve leakages of councilsrevenue,” he said.
He added: “Tamisemi is very happy to partner with NMB to make revenue collection much easier. The launch of this service will offer us convenience in revenue collection and positively contribute to the country’s economic growth. I believe this will take us a step further in revenue collection within our councils.”
For her part, The NMB Managing Director, Ineke Bussemaker said the launch of the integration adds yet another milestone that the NMB has registered in the history of serving the government and adds value to the true partnership it has with the government as the preferred financial service provider.
Ineke further said in a pilot with the Arusha City Council in quarter 4 of 2015, the collections increased from 2,189 transactions valued at 1.2bn/- to 7,485 transactions valued at 2.7bn/- in quarter one 2016.
“The example of Arusha City Council proves that we can help double revenue collection and even triple in some areas,” said NMB CEO.
Currently, NMB has integrated through LGRCI with 32 councils, with the aim to complete rollout to over 86 councils connected to the Dodoma data centre by April 30, 2016.
NMB has integrated its banking system with the Local Government Revenue Collection Information System (LGRCIS) to allow payments to be made through NMB channels – branches, NMB mobile, NMB Wakala and Cash Collection Points (CCP). With this move, there will be no handling of cash by council staff in a move that is expected to double revenue collection volumes.
Other government agencies and institutions already integrated with NMB system are Ministry of Livestock, Tanzania Revenue Authority, Tanzania Ports Authority, Tanzania Ports Authority and Brela.
However, National Microfinance Bank PLC is Tanzania’s leading retail bank, both in customer base and branch network. With over 2 million customers, about 175 branches and over 600 ATM’s, NMB is represented in more than 95 percent of Tanzania's districts.
NMB’s largest shareholders are its strategic partners Rabobank with a 35 percent shares and the government with a 32 percent shares.