Tanzania licences first credit bureau

Tanzania’s central bank has licensed the country’s first credit reference bureau to encourage information sharing among banks to spur lending and lower commercial interest rates, it said on Saturday.

Dun & Bradstreet, a global business information firm, was licensed as the credit reference bureau.

“Access to individual or company’s credit history reduces incidences of institutions lending to habitual defaulters,” said Juma Reli, deputy governor at the central bank.

Banks in Tanzania suffer from high credit risk exposure partly due to a lack of sufficient information about borrowers, analysts said.

“The retail lending rates are very high in Tanzania, with commercial banks charging rates of up to 22 percent,” said Moremi Marwa, CEO of Tanzania Securities Limited.

“In the previous quarter, some major commercial banks had over 10 per cent non-performing loans, which is quite a high rate.”

Credit to the private sector grew at an annual rate of 19.7 per cent in the year to July, compared with 25.3 per cent recorded a year ago.

Meanwhile, Tanzania plans to restructure its Petroleum Development Corporation to help it  regulate its natural gas discoveries.

It could be split into two, one to act as an upstream regulator of gas industry and the other as a commercial oil firm.

—Reuters