Tanzania’s private sector is showing strong signs of growth after total credit to businesses reached Sh43 trillion, highlighting increased confidence from banks and improved economic activity across key sectors.
According to recent financial data, the rise in credit reflects a steady recovery of the economy, driven by government reforms, improved access to finance, and growing demand in sectors such as trade, manufacturing, agriculture, construction, and services.
Economists say increased lending to the private sector is a positive signal, as it enables businesses to expand operations, invest in new technologies, create jobs, and increase productivity. Small and medium-sized enterprises (SMEs), which form the backbone of the economy, are among the biggest beneficiaries of improved credit access.
The growth in private sector credit has been supported by stable inflation, lower interest rates, and policy measures aimed at strengthening the banking sector. Financial institutions have also become more willing to lend as loan performance improves and economic risks decline.
Government initiatives to support business growth have played a key role. These include infrastructure investments, reforms to improve the business environment, and policies that encourage local production and value addition. The expansion of digital financial services has also made it easier for businesses to access loans, manage payments, and reach new markets.
Despite the positive outlook, experts caution that challenges remain. Some businesses, especially smaller firms, still face difficulties accessing affordable credit due to high collateral requirements and limited financial records. Stakeholders are therefore calling for more inclusive financing models, such as credit guarantee schemes and targeted funding for youth- and women-led enterprises.
Looking ahead, analysts believe that continued growth in private sector credit will help accelerate industrialization, boost employment, and strengthen Tanzania’s overall economic performance.
With the right policies and sustained financial support, the private sector is expected to remain a key driver of the country’s development agenda.
