MEMBERS of Tanzania Institute of Microfinance Institutions (TAMFI) have been urged to do business transparently as a way to boost their revenues and image.
Addressing TAMFI members in Dar es Salaam on Tuesday, Lead Africa Analyst of Microfinance Information Exchange (MIX) based in Washington DC, Ms Audrey Linthorst, said that sharing information with peers, clients, shareholders and potential investors was paramount for the development of the sector.
"There are many benefits for microfinance Institutions that are carrying out their duties in a more transparent manner for clients, stakeholders and public at large. It builds trust and credibility. It's one of the best ways to attract investors," she said. She urged TAMFI members to upload their profiles and reports in MIX portal as one way of promoting transparency.
She said MIX was committed to strengthening financial inclusion and the microfinance sector by promoting transparency. "We provide information on microfinance institutions, funders, networks and service providers dedicated to serving the financial sector needs for low-income clients.
She urged TAMFI members to join MIX by registering at the body's portal so as to put themselves at the global watch of the industry. By joining MIX, micro finance institutions are required to make public their profiles, number of borrowers and clients per each loan officer, duration for repayment, profits on returns and risks, she said.
Ms Linthorst lamented that micro finance institutions in Africa were lagging behind in providing information when compared to other continents. In Tanzania only 14 institutions are providing information to MIX and yet, there are hundreds of such institutions in the country.
She said that there were no qualifications for an institution to qualify in having its performance data published so long as it is a microfinance institution and there are no levies charged. Ms Winnie Terry, TAMFI Executive Secretary said her organization has been advocating for best practice among members including transparency.
"We adopted a code of conduct last year and our members are providing borrowers with all the information they need before they take a loan," she said, adding it was a big step on micro finance institutions becoming transparent in Tanzania. TAMFI is an umbrella organization for about 51 Microfinance organizations working in Tanzania.
TAMFI works to strengthen Tanzania's microfinance sector by promoting cooperation and collaboration among its member organizations, providing training, conducting research and lobbying the government of Tanzania, she said. Mr Amulike Ngeliama, Chairman of Mtoni Lutheran Church Saccos Limited in Temeke District said it was true greater transparency and accountability was needed in the micro-finance sector.
"I am convinced MIX can increase the visibility of our institutions at both country and world level," he said. Providing data to such a platform would expose institutions to more investors, which at the end of the day minimizes risks. MIX is funded by some of the world's renowned financial institutions like Bill & Melinda Gates Foundation, CGAP, Omidyar Network, The MasterCard Foundation, IFAD, Michael & Susan Dell Foundation, Citi Foundation, Ford Foundation and Deutsche Bank.