BoT to launch Credit Guarantee Corporation to improve lending

Speaking at the Second Banks and Financial Institutions Leaders’ Forum on Monday, 30 March 2026, BoT Governor Emmanuel Tutuba said the initiative is part of ongoing reforms to create a more inclusive financial sector.

The forum brought together regulators and industry leaders to review progress and chart the path for deepening financial inclusion.

Mr Tutuba explained that the CGC will operate as a government-backed credit guarantee system managed by the central bank. Plans are in place for it to evolve into a standalone corporation.

The facility will work with commercial banks to reduce lending risks by partially guaranteeing loans issued to underserved groups, particularly youth, small entrepreneurs, and informal businesses.

“This model is widely used in emerging economies to unlock credit access. It allows banks to lend confidently while encouraging borrowers to formalise their operations,” he said.

Under the planned system, borrowers without collateral will apply through their banks, receive guarantee backing, and access technical support to develop viable, bankable proposals.

The scheme is expected to strengthen credit appraisal systems, improve loan performance, and expand the reach of formal financial services nationwide.

The initiative complements reforms supported by the World Bank, which has extended $150 million to the facility.

Part of this funding will strengthen financial infrastructure, improve access to credit for SMEs, and support financial inclusion frameworks. The CGC is expected to ensure these funds translate into actual lending.

Deputy Governor for Financial Stability and Deepening, Sauda Msemo, said parallel efforts are underway to improve the legal and regulatory frameworks governing borrowing.

The aim is to make lending more accessible and transparent, especially for groups historically excluded from formal finance.

She highlighted progress in promoting gender equality in the banking sector.

Women now hold over 30 percent of leadership positions, with 30.6 percent representation at board level and 30.7 percent in senior management.

This marks progress towards the 2024 directive requiring at least 30 percent female representation in leadership by 2028.

“So far, 22 out of 42 licensed banks have met or exceeded this target. Additionally, 20 banks now have at least one-third female representation in both governance and leadership,” she said.

The sector has also strengthened gender-focused policies and products.

Banks with formal gender policies have risen from 21 to 33, while those offering women-focused financial products have increased from 15 to 26. More institutions are implementing inclusion programmes and tracking their impact through data.

Speaking at the forum, Tanzania Bankers Association chairman and NBC Bank managing director, Theobald Sabi, said the industry is aligning strategies with inclusive growth objectives.

“This is the first forum dedicated to ensuring women take on leadership roles in banks and financial institutions, while also driving tailored financial products and awareness initiatives,” he said.

He commended BoT, the Ministry of Finance, and the government for prioritising gender inclusion.

Many banks are not only meeting regulatory thresholds but also investing in long-term strategies, such as leadership development programmes and specialised financial products for women.

Mr Sabi identified four priority areas.

These include expanding gender-responsive financial products, strengthening financial literacy and entrepreneurship support for women.

Others are enhancing inclusive regulatory frameworks, and improving the use of gender-disaggregated data in decision-making.