Dar es Salaam — A new partnership has been inked to boost financial inclusion.
The Financial Sector Deepening Trust (FSDT) and the Financial Sector Deepening (FSD) Africa on Tuesday, June 19, announced the partnership with NMB Bank, Jamii Africa and Resolution Insurance to develop innovative and successful financial products and services.
The three financial partners have been selected through a rigorous competitive process that involved a call for proposal that was advertised in newspapers and the FSDT website to encourage all financial service providers to apply.
Under the partnership known as 'DataDisrupt' project, financial services providers will be provided with the opportunity to use evidence generated from internal and external data sources to innovate and deliver affordable financial products and services that respond to the needs of their customers.
FSD Africa competitive strategies director Paul Musoke said despite improvements in the provision of, and access to, formal financial services across Tanzania, financial exclusion still persists.
He said the needs of low-income individuals, especially farmers, women and young people continue to be ignored.
According to him, for many customers living in peri-urban and rural areas accessing financial services, remains a challenge.
"DataDisrupt seeks to bring about meaningful financial inclusion by developing the business case for data-driven evidence-based decisions that inform the design and delivery of products and services that meet the needs of people presently unserved and underserved by formal financial service providers," said Mr Musoke.
FSDT executive director Sosthenes Kewe said commercial banks have been confined to serving less than two out of 10 Tanzanians for the past decade.
Stating that although insurance penetration has increased between 2009 and last year, it remains low as well, at only 16 per cent, with health insurance accounting for a lion's share of the percentage.
"Financial service providers struggle to expand their customer base, as well as promoting product usage among existing customers," said Mr Kewe.
"Even though they capture consumer data and have access to external data sources, they still encounter challenges in converting the data into insights that lead to solutions."
FSDT research advisor Julia Seifert said DataDisrupt was working closely with their partners to enhance their capabilities, to manage and analyse data, develop and innovate new business models.
"We are committed towards generating sustainable improvements for the underserved especially rural dwellers, women and youth, by implementing better financial access strategies," noted Ms Seifert.