Financial Services

Tanzania Finance and Enterprise Development (TFED) project (1993 – 1997) assisted the government of Tanzania to lay down a framework for reforms and ultimately liberalized the financial sector. Before 1995, public/state banks dominated the market. Interest rates were very high, investments were made with no basis for economic/financial viability, cost of borrowing was very high and lending to the private sector was limited to short term loan products.

Reforms of the financial sector exposed the public banks and the government to free market forces. Treasury Bills interest rates leveled to market rates, inefficient banks were closed or restructured while others were sold and acquired by efficient venturers and to top it all new local banks and foreign multinational banks entered the.

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