Morogoro — MICROFINANCE institutions should extend services to the rural people to support the country's war against poverty.
Tanzania Association of Microfinance Institutions (TAMFI) Board member Altemius Millinga told a two-day seminar for Microfinance Institutions' (MFIs) leaders here that it was of paramount importance to take financial services to the mass rural population.
"It is very important to MFIs to look at ways of reaching the rural population. At TAMFI we are looking at ways of building the capacity of MFIs to spread micro finance services to people in rural areas," he said.
He said available research shows that only three per cent of the population in the rural areas has access to finance. Seminar Facilitator Peter Mukwana from Kampala-based SkyMark Consulting Ltd told the participants that one of the most important elements of agri-finance was granting of loans and provision of savings mechanism for agricultural production.
He said despite agricultural sector employing about 80 per cent of the active labour force in Tanzania, the sector has never reached its economic potential. One of the reasons for the failure has been the model used to finance agriculture whereby agri-loans are inappropriately structured.
TAMFI Executive Secretary Winnie Terry said Tanzania boasts of over three hundred microfinance institutions but most of them are serving people in urban centres. "The rural community lacks financial services - loans, deposits and advisory services."