Tanzania’s financial inclusion agenda recorded significant progress in 2025, with millions of citizens gaining easier access to formal financial services, but regulators say the country’s next major challenge is ensuring that access translates into meaningful use that improves household welfare, business growth and economic resilience.
The latest Annual Financial Inclusion Report from the National Council for Financial Inclusion (NCFI) shows that Tanzania’s Financial Inclusion Index (TanFiX) increased to 0.83 in 2025, up from 0.81 in 2024, reflecting continued expansion of financial infrastructure, digital payment platforms and access points across the country.
However, the report highlights a widening gap between access and usage. While the Access Sub-Index increased from 0.84 to 0.87, the Usage Sub-Index rose only slightly from 0.78 to 0.79, indicating that many Tanzanians can reach financial services but are not yet using them fully to support savings, investment and economic activities.
NCFI Chairperson Emmanuel M. Tutuba said the progress demonstrates the impact of the Third National Financial Inclusion Framework (NFIF3, 2023–2028), but acknowledged that improving product quality, expanding financial literacy and strengthening financial resilience remain unfinished tasks.
The focus of financial inclusion policy is now shifting from simply increasing the number of people connected to the financial system to ensuring that services are affordable, accessible and relevant to citizens’ daily needs.
Mobile money remains the strongest driver of Tanzania’s financial inclusion progress, with digital platforms becoming the main channel through which millions of citizens access financial services.
The number of financial access points increased by 33.5 percent to 2.27 million in 2025, largely due to the expansion of mobile money agents.
Mobile money agents reached nearly 2 million, representing a 34.4 percent increase compared with the previous year, strengthening financial service availability in rural and underserved areas where traditional bank branches remain limited.
Active mobile money accounts increased by 6.7 percent to 75.8 million, while transaction volumes reached 6.31 billion transactions during the year.
The growth of digital finance was supported by wider telecommunications coverage. Mobile subscriptions increased by 23.1 percent to 106.9 million, while smartphone penetration improved to 41.8 percent from 36 percent, creating opportunities for digital banking, online payments and fintech solutions.
Despite these gains, the report notes that increased access does not automatically translate into improved financial wellbeing unless citizens actively use available services.
The expansion of financial inclusion has been supported by improvements in identity systems, electricity connectivity and payment infrastructure.
National Identification Numbers reached approximately 81 percent coverage among eligible adults, with more than 21 million IDs issued through the National Identification Authority (NIDA).
The NIDA database is now connected with 138 public and private institutions, improving electronic Know-Your-Customer (e-KYC) processes for banks, insurance companies and social security institutions.
Electricity expansion has also strengthened the foundation for digital financial services. Rural electrification reached all 12,318 mainland villages, while electricity connectivity at hamlet level increased to 52.3 percent.
The Tanzania Instant Payment System (TIPS) has further improved the digital payments environment by connecting 47 financial service providers.
Lower transaction costs, including reduced bank-to-wallet transfer charges and a maximum retail bank transfer fee of 2,000/-, are expected to encourage more citizens and businesses to shift towards electronic payments.
Although lending expanded during the year, access to productive credit remains a major challenge, particularly for small businesses, youth and women.
Total loan accounts increased by 9.1 percent to 2.4 million, while outstanding credit grew by 28.1 percent to 48.4trn/-.
However, credit growth was uneven across economic groups.
The number of MSME loan accounts more than doubled to 578,692, showing increased participation of small businesses in formal finance. However, the value of MSME loans declined by 23.2 percent to 10.4trn/-.
The decline suggests that while more businesses are entering the formal credit system, many entrepreneurs still struggle to access larger financing required for expansion, investment and job creation.
Limited collateral, informal business structures and weak financial records remain among the main barriers preventing MSMEs from obtaining adequate financing.
Youth access to credit also weakened, with youth loans declining by 20 percent to 4.05trn/-.
The report attributes the decline to unstable incomes, limited collateral and a shortage of financial products designed specifically for young entrepreneurs.
Women’s participation in financial services improved through targeted banking products and financial education initiatives.
Women’s loan accounts increased by 4.2 percent, although the value of loans declined from 13.9trn/- to 7.4trn/-, highlighting continued challenges in accessing larger financing.
The report also shows progress beyond traditional banking services.
Insurance beneficiaries increased by 3.4 percent to 26.8 million, reflecting gradual improvement in awareness and adoption of insurance products.
Capital markets recorded notable growth, with the number of investors more than doubling to 2.18 million, largely driven by collective investment schemes.
Participants in collective investment schemes expanded more than threefold to 1.44 million, suggesting growing interest among households in investment opportunities beyond ordinary savings accounts.
Social security participation also improved, with total pension accounts exceeding 3 million.
Informal-sector participation increased by 64.4 percent, indicating rising awareness among self-employed workers about retirement planning.
Tanzania’s financial sector is also preparing for greater innovation through regulatory sandboxes aimed at supporting responsible fintech development.
The Bank of Tanzania reviewed 35 fintech applications and approved five products for live testing.
Among the innovations being explored is a stablecoin-based cross-border payment solution targeting tourism transactions.
The central bank continues studying the possibility of introducing a Central Bank Digital Currency, while maintaining that cryptocurrencies are not recognised as legal tender and remain outside the formal regulatory framework.
The report’s main message is that Tanzania has made substantial progress in expanding financial access, but the next phase will determine whether those gains translate into stronger economic outcomes.
The growth of financial inclusion has taken place alongside improvements in financial stability, with non-performing loans declining to 3.3 percent from 9.3 percent in 2021, lending conditions improving and economic growth remaining stable.
However, policymakers recognise that the success of financial inclusion will ultimately be measured by how effectively citizens use financial services to save, invest, access productive credit and protect themselves against economic shocks.
With three years remaining under NFIF3, Tanzania’s priority is expected to shift towards closing the usage gap, particularly among youth, MSMEs and rural communities.
The country’s next financial inclusion milestone will therefore depend not only on reaching more people, but on turning financial access into a tool for improving incomes, entrepreneurship and long-term economic security.
