Tanzania: Microfinance Groups Obtain Sh20bn ($15 million) Loan
Dar es Salaam, Tanzania, December, 05 2009 -
The Small Entrepreneurs Loan Facility (SELF) has so far dished out Sh21 billion to 228 micro finance groups in the country, the minster for Finance and Economic Affairs said in Dar es Salaam yesterday.
Speaking at the 6th Annual stakeholders meeting of the SELF project, the minister said the large percentage of the loans has been directed to rural areas and benefited over a quarter of a million people.
It was established during the workshop that the levels of returns have been at 95 per cent, which is an acceptable worldwide standard.
The minister said in a move aimed at expanding its services, SELF was rolling out the second phase, which will increase its outreach from the current six regions to the whole country.
About $130 million (Sh169 billion) will be used to issue loans countrywide, being a commitment from the African Development Bank.
The meeting, whose theme this year is ?Expanding outreach of financial services in rural areas?, is meant to evaluate if the support given by the project satisfies the needs of the targeted people.
SELF started in six regions but has now expanded across Tanzania starting with the second phase which commences in mid 2010.
Mr Mkulo noted that after evaluating phase one, the Government had agreed with the AfDB that phase two would start mid next year.
He said that SELF had to cultivate its position as the power of micro finance to change peoples? lives as there is demand for micro credit especially in private sector which remains low "We should address the issue of how we can access more credit to the poor," he observed.
Mr Mkulo said that since 54 per cent of Tanzanians had no access funds to financial institutions, there was still a need to inculcate a culture of saving.
There are currently 5042 Saccos with Sh160.4 billion savings countrywide.
There are currently 238,613 borrowers in the micro finance. The $130 million AfDB money will be used to establish a credit fund and enhance further policy dialogue. Discussions are, however, still ongoing between the government and AfDB for the funding of the second phase.