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| Dr Kigoda |
The Ministry of Industry and Trade has challenged commercial banks to
find ways of lowering borrowing costs especially for Small and Medium
Enterprises (SMEs) to accelerate economic growth.
The ministry said that, at the moment the SMEs, despite their immense
contribution on industrial output and trading, the sector is facing numerous
challenges especially on how to raise relative affordable capital.
The minister said the bottom line should be on how to promote this sector,
which is the engine on economic growth, to access affordable capital plus
managing their finances.
Dr Kigoda said he was aware of the other variables
that are pushing up interest rates, such as inflation and Treasury Bills rates
but promised that the government is working round the clock to control the
same.
“We should help farmers increase productivity to sustain ourselves and
have enough for export, as this will help lower the inflationary pressure,” Dr
Kigoda said.
Speaking previous, Barclays Bank Tanzania CEO,
Mr Kihara Maina said that despite credit being an integral component to drive
an economy, banks which offer the service to the public feel comfortable when
putting client deposits at risk when lending.
“To be able to do that, it is important to ensure lending practices are
as safe as possible. We need therefore infrastructure around safeguarding
credit to be in place,” Mr Maina said. He commended Stanbic for opening a full
fledged branch that would cater for SMEs at the heart of business trading in
Kariakoo.
On his part, Stanbic’s Head of Marketing and Corporate Affairs, Mr
Abdallah Singano said the branch would help reduce congestion at Narung’ombe
branch, as the number of customers for their SMEs Quick Account has increased
very fast.
“So far over 30bn/- has been issued in a span of about one year
since the introduction of SMEs account, benefiting over 1,920 clients,” Mr
Singano said, adding:
“All these loans have been issued to our clients in Kariakoo area
alone. This necessitated opening another branch to cater for the increasing
customers demand.”
Stanbic’s SMEs Quick Account client, Mr Charles Mlawa said
that easy accessibility of the loan has boosted his business in less than one
year, owning three shops, up from one.
Mr Mlawa, a Director of Tropical Electrical Goods Shop which has
employed 30 staff from three about 15 years ago, said: “If it were not for the
bank’s Innovative Account, I could not be able to expand.”
According
to the Ministry of Industry and Trade data, Kariakoo area is one of major East
African trading hubs, serving roughly 60,000 clients a day.
Source: The Daily News,http://www.dailynews.co.tz, reported by Abduel Elinaza in Dar es Salaam