The Board of Directors of the African Development Bank Group has approved a $60 million loan to the United Republic of Tanzania to strengthen the capital base of the Tanzania Agricultural Development Bank (TADB), under the third phase of the TADB Equity Enhancement Project.
The loan, approved on 21 October 2026, will be channelled through Tanzania's Ministry of Finance and the Office of the Treasury Registrar and invested as equity in TADB. It forms part of a $120 million initiative, with the Government of Tanzania contributing an additional $60 million through the capitalisation of eligible retained earnings.
Agriculture employs approximately 65% of Tanzania's workforce and generates about a quarter of its economic output yet receives only around 12% of private sector credit. Despite the sector's importance, challenges such as perceived risk, short loan tenors, weak collateral and scarce long-term funding have left an estimated annual financing gap of $1.5 billion, with women and young people hardest hit.
The new capital will allow TADB to lend at greater scale and for longer tenors, both directly and through wholesale lending and co-financing with partner financial institutions and commercial banks.
"Agriculture is not only about producing food. It is about creating jobs, building businesses and improving livelihoods for millions of Tanzanians," said Ahmed Attout, Director of the Financial Sector Development Department at the African Development Bank. "By strengthening TADB, we are putting more capital within reach of farmers and entrepreneurs who can transform the country's economy."
The Tanzania Agricultural Development Bank Phase III Project places women and young entrepreneurs at its centre. At least 30 per cent of the jobs supported are expected to benefit women, with another 30 per cent targeting young people. By 2030, TADB aims to increase financing for women-owned enterprises to 30 per cent of its portfolio, and financing for youth-led businesses to 20 per cent.
The funding will also increase climate-smart lending for efficient irrigation, renewable energy, improved storage, and technologies that reduce crop losses. Climate-smart agricultural loans such as these are expected to account for 12 per cent of TADB's portfolio by 2030, up from 3 per cent in 2025.
Frank Nyabundege, TADB Managing Director, said:
"Agriculture remains the backbone of Tanzania's economy and sustaining millions of livelihoods. This capital strengthens TADB's capacity to deepen its impact and expand access to inclusive and sustainable financing for farmers and agribusinesses across the country. In doing so, this valuable support reinforces TADB's role as a strategic development partner in advancing Tanzania's long-term national aspirations under Dira 2050, propelling agricultural transformation and inclusive economic growth in Tanzania."
This third phase of the TADB project builds on earlier Bank Group support that has helped the bank expand agricultural lending and reach underserved communities. The initiative supports Tanzania's Development Vision (Dira) 2050 and the African Development Bank Group's Four Cardinal Points strategic vision, which commits it to expanding access to capital, creating jobs and strengthening climate-resilient agricultural systems.
About TADB:
Tanzania Agricultural Development Bank is a state-owned development finance institution with a mandate to catalyse sustainable and inclusive agricultural financing through the provision of short, medium and long-term loans in the quest to contribute to agricultural transformation and sustainable development in Tanzania. For further information, visit: www.tadb.co.tz
