NMB embarks on strategy to increase deposit levels

National Microfinance Bank (NMB) has embarked on a drive to increase deposit levels by offering up to 10 per cent interest rates under its bonus and junior accounts.

The two account holders also have the chance of wining building material, school fees, school bags and polo shirts in monthly draws for the next three months of the promotion.

According to the Bank’s Head of Marketing and Communication, Mr Imani Kajula, the monthly draws will be staged to pick winners as a way to entice depositors build a saving culture.

“Our research shows that most of our customers are saving in order to accomplish their plans or ambitions, that way we want them to achieve their life goals,” Mr Kajula told journalists on Thursday.

NMB was the most profitable bank last year, but its deposits are far below CRDB bank which is the largest bank in terms of assets and deposits in the country.

In the first quarter of this year, NMB total deposits were 1.95trn/- compared to CDRB’s 2.4trn/- while the National Commercial Banks came third with 1.3trn/-. 

The bank controls between 30 and 40 per cent of total customers in the country where bank penetration is around 20 per cent of the population.

NMB, a pro-poor bank, also needs to raise its deposits to enable it increase loan portfolio, which by the end of March this year reached 61.5 per cent, close to regulator ceiling rate of 80 per cent.

On other hand, competition in the banking sector intensified following the new entrants in the market namely FNB of South Africa and Equity Bank of Kenya.

The new banks, especially FNB, introduced competitive deposit rates of over 10 per cent to push up the market rates for almost all banks, as deposits became scarce following high inflation rate of 18.7 per cent of April.

According to NMB, during the promotion, the balance in the account that is subjected to receive interest should start from 50,000/- and above, but any deposit or new accounts qualify to enter into the monthly draw.

NMB is also the biggest bank in terms of network where in the last five years it managed to increase its branches from 100 to 140 and 450 ATMs country wide. Its customers have reached 1,600,000.

Source: The Daily News,http://dailynews.co.tz, reported by Abduel Elinaza

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