What is the future of digital finance in countries like Tanzania?
Digital finance sustains economic growth of a country.
Digital finance is at the forefront of many people’s minds when it comes to economic growth, but what about in parts of the world where the economy is lacking somewhat? Well, surprisingly digital finance does appear to be taking off, and in actual fact it is showing signs of actually helping to strengthen and boost the economy. Take Tanzania for example. The country is one of the more impoverished locations in Africa, and although it has seen steady growth over the years, many households still live well below the poverty belt. Believe it or not however, but digital finance could actually be set to change this for the better. For those asking what is the future of digital finance in countries like Tanzania, the future actually looks incredibly bright indeed. Here’s a look at how digital finance could revolutionize Tanzania, and other similar countries around the globe in similar situations.
Are mobile phones the future for banking in Tanzania?
For those of us living in more developed parts of the world, mobile banking is as common as regular TV. For Tanzania, and other less developed countries however, mobile banking is still a relatively new concept. When mobile banking and digital finance was introduced to Tanzania a few years back, individuals all of a sudden found themselves having access to a wide range of cheap and convenient banking options. Through mobile phones, individuals and businesses alike, could send and receive funds, worldwide, in a wide range of different currencies. This innovation opened up an entirely new world of banking possibilities for people living in Tanzania.
The future of digital finance in Tanzania
Numerous studies conducted over the years, have actually revealed that banks in Tanzania, including the Tanzanian Postal Bank, have enjoyed huge success over the years since they deployed their new digital finance services. These new services have helped to achieve enhanced rates of financial inclusion across East Africa.
As mentioned, mobile banking is just one example, but what else is there in terms of digital finance? Well, in reality there are several other options, including point of sale and agency banking. This is very useful because it means that everyday individuals, including those living in more rural locations, can still benefit from digital finance.
Between 2012 and 2014, statistics have revealed that the number of transactions carried out via mobile devices, shot up from 8.8% all the way up to 44.36%. Since then, these numbers have increased further, which in turn helped to boost the economy as the banks received greater incomes.
As more people signed up for mobile banking, and as word of mouth spread about how convenient and effective mobile banking became, more and more people began signing up, thus the expansion continued. What’s more, as mobile technology and coverage also improved, so too did digital finance options and banking services.
Currently, the Bank of Tanzania provides guidance and oversees many aspects of digital finance with the intention of creating value for shareholders, market players, and users in general. The world of digital finance is ever changing, so in order for Tanzania, and other similar countries, to stay relevant and to continue to expand, they too will need to stay up-to-date with changes and advancements in the world of digital finance.