Tanzanian commercial banks recorded a combined net profit of Sh2.47 trillion in 2025, reflecting strong growth in lending, increased customer deposits, and wider use of digital banking services.
According to banking sector data, the strong performance was driven mainly by higher interest income from loans, improved cost management, and growth in non-interest income such as transaction fees, mobile banking services, and foreign exchange trading.
Lending and Deposits Drive Growth
Banks expanded their loan books in 2025 as businesses and households increased borrowing, especially in trade, manufacturing, agriculture, construction, and personal lending. This helped banks earn more interest income, which remains their biggest source of revenue.
Customer deposits also grew steadily, giving banks more funds to lend while keeping borrowing costs relatively stable.
Digital Banking Boosts Earnings
The rise in digital and mobile banking platforms played a key role in boosting profits. More customers used mobile apps, internet banking, and agency banking, allowing banks to reach more people while reducing operational costs.
Digital services also increased transaction volumes, helping banks earn more fees without opening many new branches.
Improved Asset Quality
Banks also benefited from better loan repayment, with fewer non-performing loans compared to previous years. This reduced losses and allowed banks to keep more of their earnings as profit.
Stronger credit risk management and closer monitoring of borrowers helped improve the overall health of bank balance sheets.
Economic Recovery Supports Banking Sector
The strong performance came amid continued economic recovery, supported by public infrastructure spending, private sector activity, and stable monetary policies by the Bank of Tanzania.
Lower inflation and a stable financial environment encouraged borrowing and investment, further supporting banking growth.
Outlook for 2026
Analysts say banks are expected to maintain solid performance in 2026, supported by economic expansion, digital innovation, and financial inclusion initiatives. However, they caution that rising competition, regulatory changes, and global economic uncertainty could affect profit margins.
Still, the 2025 results underline the resilience and growing strength of Tanzania’s banking sector, positioning it as a key driver of economic growth.
