Dar es Salaam. Lower-income Tanzanians who have long been excluded from conventional mortgage financing due to stringent lending conditions can now access housing loans under a newly launched financing solution.
The opportunity follows the official introduction of a Wholesale Housing Microfinance product by Tanzania Mortgage Refinance Company Limited (TMRC) in partnership with Habitat for Humanity International.
The scheme is designed to support individuals previously locked out of traditional mortgage facilities for failing to meet requirements such as formal land titles or strict collateral conditions.
Under the new arrangement, through which TMRC will disburse Sh30 billion, borrowers will not be required to present title deeds. Instead, participating financial institutions will assess applicants based on income levels and alternative acceptable forms of collateral.
Official statistics indicate that only about three percent of Tanzanians currently qualify for mortgage loans. Stakeholders say the new model is expected to significantly broaden access to housing finance, particularly for citizens in the informal sector who often lack formal documentation.
Launching the product, Deputy Minister for Finance, Mr Mshamu Munde, said access to safe and decent housing is a fundamental human need and a cornerstone of social and economic development. However, many low-income earners and informal sector workers have struggled to secure affordable loans to build, renovate or complete their homes.
“As the Ministry of Finance, we support these efforts in practical terms. We have approved the recommendations of a team of experts to transfer part of the Housing Finance Project (HFP), which was previously under the management of the Bank of Tanzania — particularly the Housing Microfinance Fund — to TMRC so that the fund can continue to grow and enable more low-income Tanzanians to access safe and decent housing,” he said.
Mr Munde added that the ministry has taken note of concerns raised by stakeholders and stands ready to collaborate with partners in the housing microfinance sector to ensure full implementation of the initiative.
TMRC Chief Executive Officer, Mr Elibariki Ndossi, said the programme will enable low-income citizens to construct or complete their homes. He revealed that the company has already signed agreements with two financial institutions, with more expected to join.
He said preliminary research conducted before the launch confirmed strong demand for housing finance among low-income earners. During the pilot phase with the two institutions, more than Sh1 billion was disbursed to wananchi for home construction.
“There is a significant demand for housing. We will provide loans at affordable interest rates, and borrowers will not need a land title deed — a requirement that previously limited access to bank loans. Our primary assessment will focus on a borrower’s income,” he said.
Habitat for Humanity International’s Associate Director for Housing Finance in Africa, Mr Daniel Mhina, noted that more than 70 percent of Tanzanians build their homes progressively, with some taking up to 18 years to complete construction.
He said the new product will enable families to complete and own their homes within a shorter timeframe.
“This launch is more than the introduction of a financial product; it is a response to a long-standing need among families, particularly those with irregular incomes or those working in the informal sector,” he said.
