NMB Bank sets aside Sh1 billion seed funding for local innovators

Friday October 22 2021
NMB pic

Bank of Tanzania deputy governor Bernard Kibesse (centre) shares a light moment with NMB Bank board chairman Edwin Mhede (R) and the bank’s chief executive, Ms Ruth Zaipuna, during the launch of Tanzania’s first “Sandbox Environment,” . PHOTO | CORRESPONDENT

By Rosemary Mirondo

Dar es Salaam. NMB Bank Plc yesterday launched Tanzania’s first “Sandbox Environment” for local startups as it seeks to inspire technological innovations for better delivery of financial services in the country.

The launch in Dar es Salaam yesterday was graced by the Deputy Governor of the Bank of Tanzania (BoT), Dr Bernard Kibesse.

The sandbox allows startups to partner and work with the bank for testing and delivering innovative financial solutions.

NMB Bank Plc is backing the initiative with a financing package of Sh1 billion for seed funding the solutions and inventions with marketability credentials and transformative potential to elevate local banking to new heights, CEO Ruth Zaipuna said yesterday.

Under the setup, startups and tech savvy Tanzanians will be accorded an easy way to integrate solution innovations with NMB Bank platforms for testing their readiness to be marketed.

This will be done after getting the requisite approvals from the Bank of Tanzania (BoT).

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BoT applauded the NMB Sandbox Environment, with Dr Kibesse saying the initiative would promote innovation and creative solutions, which will greatly boost growth of the financial sector and help banks to improve service delivery.

“Today’s event goes hand in hand with the government’s initiative to support technological breakthrough driven by youth in the country,” the BoT leader noted in his inaugural speech.

According to him, the new NMB venture is according local startup companies and young tech savvy entrepreneurs a rare opportunity to showcase their capabilities and create innovative financial solutions which will help to reduce the cost of banking services and create employment opportunities.

He said the investment was yet another demonstration by NMB to support efforts of the government to address limitations Tanzanians face when accessing banking services, which include limited access to financial products and fewer distribution points.

“I applaud NMB Bank for being on the forefront in supporting the Government efforts, as demonstrated by various initiative being taken by the bank including the recent decision to set aside Sh100 billion for the purpose of lending to the agriculture sector at interest rate not exceeding 10 percent,” Dr Kibesse noted.

He called on the bank to come up with a similar arrangement for startups and young innovators since limited access to affordable credit was one of the major drawbacks to their entrepreneurial and innovation endeavors.

Dr Kibesse said Tanzania has many innovators who fail to deliver accordingly and make meaningful breakthroughs mostly due to lack of supportive opportunities and working capital.

“Through initiatives such as your sandbox environment, creative Tanzanians will have a place where to test their innovative ideas for creating solutions, which will not only support service delivery but also help to create new jobs,” the Deputy Governor noted.

Speaking earlier, Ms Zaipuna said leveraging technology to provide best-in-class experiences to NMB Bank’s customers and serve Tanzania continues to be the lender’s top priority.

She noted that due to its huge technological investments, financial inclusion agenda and capital muscle, NMB this year managed to scoop seven international awards of excellence, including one for being the most innovative lender in the country.

Ms Zaipuna said the sandbox initiative will not only expands NMB’s digital platforms but also consolidate its innovation prowess leadership in the market.

“The Sandbox Environment is a platform that allows startups to experiment, test and pre-certify integration with our banking services,” she explained - noting that its experts have created a clear guide on security and risk assessment, which the bank will perform to allow the innovators to transition to its live environment.

The bank’s board chairman, Dr Edwin Mhede, said the venture was prompted by ongoing transformation in the banking industry emanating from changes such as consumer needs and competitive innovation as a result of aspects including globalisation, liberalisation, technological breakthroughs and the Covid-19 pandemic.

For his part, NMB’s Acting Chief of Technology and Digital Transformation, Mr Kwame Makundi, called on all startups willing to work with NMB Bank to seize this rare opportunity to test marketability readiness of their innovations.