Tanzania Daily News (Dar es Salaam)

17 December 2012

Tanzania: Banking Services Set to Transform Mtibwa

TO keep alive its promises, Bank of Africa opened yet another branch in Mtibwa, Morogoro region recently. The branch that becomes the 17th was opened by retired President Benjamin Mkapa within the Mtibwa Sugar Estates Ltd.

Our Correspondent who attended the event explains in this feature what really happened and the importance of the branch... GLOBAL financial institutions including World Bank support rural banking, the process of conducting banking transactions out in the country where bank branches are too far away to be of use.

It is popular for very small towns and farmers who live far away from areas of larger population and cannot make the drive to these locations whenever they need to use banking services. Rural banking is a common practice in places where banking institutions are few and far between, and people who need to carry out banking transactions may have difficulty finding a way to do so.

Bank of Africa (BOA) has started responding to the needs of banking services in rural areas. At Mtibwa area in Morogoro region recently, the name 'Bank of Africa Tanzania' was everywhere. At various joints, people were talking about it and road show trucks passed announcing the opening of a new branch of the Bank of Africa Tanzania at Mtibwa. Mtibwa Sugar Estate Limited is located in Turiani Division, 102 km north of Morogoro town and 290 km from Dar-es- Salaam.

Sugarcane growing and the production of sugar and related products are the main activities of Mtibwa Sugar Estates Ltd. Cane is supplied from the company's own fields and some small portion from small outgrowers in surrounding villages. Part of the sugar produced is exported to the EU under the Sugar Protocol while the remaining is sold locally. In the event held recently, placards decorated Mtibwa from every angle.

The township was filled with the euphoria. It was only later that I came to realize the reasons behind the excitement of people in Mtibwa: The bank had managed to accomplish what many banks failed to do for many years and for that reason banking services were far away.

The coming of the Bank of Africa Tanzania came as a relief to many especially within the Mtibwa Sugar Estates Ltd where the branch was opened. By opening the branch, the bank was implementing the government's policy that encourages banks to go rural and therefore encourage people who have accounts, learning how to save and facilitate development at large.

Banks need to draw strategies to bring on board people with no bank accounts and help other banking services and this is what is being done by this Pan African bank. Statistics indicate that only 15 per cent of the Tanzanians have bank accounts, at the moment. During the launch, retired President Benjamin Mkapa made an appeal to Tanzanians to cultivate the habit to repay loans so as to enable banks to continue lending other needy customers.

"There is no free loan," he said, adding that all loans have interests and they must be paid back. He noted that a person who pays a loan as required is in a chance to perform better in businesses apart from creating good name within the banking fraternity. "If you have a loan, pay it on time so that banks should be able to continue lending other people...this is my appeal to all fellow Tanzanians," he said.

He also stressed a need to cultivate a strong culture of saving for various development activities. "People with a saving culture in and outside our country have a greater chance of progress," he said.Apart of commending the bank for its decision to open the new branch, he urged the bank's management to strive and start a microfinance window which will help many people in and around Mtibwa township who otherwise get challenges in accessing loans in normal circumstances.

"By doing this, the bank will be creating a strong base of clients and contributing to the social economic development of the country," he noted. He told Mtibwa residents to see the bank as an opportunity and use it efficiently for their development. "A crucial thing here is to make sure that you use the bank to spur your economic and business activities," he said.

The Managing Director, Bank of Africa Tanzania, Mr Ammish Owusu- Amoah, called the launch of the branch, a historic one.He said the opening of the branch is a result of a long business relationship between the bank and Mtibwa sugar Estates Ltd. "The launch will go a long way in cementing our relations with the company and the community here," he said.

On his part, the General Manager, Mtibwa Sugar Estates Ltd, Mr Jerome Harel, commended the bank for opening of the new branch, saying that is in the interest of greater accessibility to financial credit facilities. "It is also a continued enhancement of the existing business relationship between the bank and our company," he said. Earlier, the Head of Retail Banking, Ms Mwanahiba Mzee, said the bank is committed to contributing towards the Tanzanian economy and this expansion just reiterates that the bank is here to stay.

She mentioned that the new branch seeks to link the Mtibwa community, Morogoro region and other stakeholders within the sugar industry in the country. "The bank aims at reaching out to new areas to bring the banking services closer to the people not only just by opening new branches but by also investing in technology that will enable our customers to have access to banking systems from anywhere in the country," she said.

The branch offers full financial services by providing a mix of personal, SME and corporate banking products and services which includes SME packages, a wide range of credit facilities ranging from overdraft facilities, short and medium term loans, working capital, invoice discounting any many others. Since it started operations in the country in 2007, the bank has managed to open ten branches in Dar es Salaam and six branches in Morogoro, Tunduma, Mwanza, Moshi, Mbeya and Arusha.

Bank of Africa Tanzania is a part of a Pan African bank called Bank of Africa Group. The Group operates in 15 countries, of which 7 are in West Africa (Benin, Burkina Faso, Ghana, Ivory Coast, Mali, Niger and Senegal); 6 in East Africa (Burundi, Djibouti, Kenya, Madagascar, Tanzania and Uganda). It is also present in the Democratic Republic of Congo and in France.

In addition to its 14 commercial banks, the Group also includes a finance company, a housing bank, a leasing company, one brokerage and two investment firms, as well as a management company and a representative office in Paris. Every development stakeholder ought to support such endeavours by the bank, for they aim at elevating Tanzanians' welfare.

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