Banks Want Speedy Issuance of National IDs

Tanzania Daily News (Dar es Salaam)

Finnigan Wa Simbeye

31 May 2011

COMMERCIAL banks operating in the country have asked the government to speed up the issuance of national identity cards to enable lenders know their clients and avoid giving loans to cheating foreigners who end up fleeing without repaying.

Tanzania Bankers Association Chairman who is also Managing Director of National Bank of Commerce, Lawrence Mafuru, said in Dar es Salaam on Tuesday that banks were falling prey to cheating foreigners who apply for loans as Tanzanians.

Launching the 2011Tanzania Banking Survey report which was undertaken by Serengeti Advisers, Mr Mafuru said loan defaulters were to blame for the continued skyrocketing interest rates that banks charge.

“We sometimes lend to people who we learn later that they are not Tanzanians and they have already left the country,” Mr Mafuru said, pointing out that such crooks would easily be checked with national identity cards in place.

National Identification Authority (NIDA) last April declared Malaysian company, Iris Corp Bhd as winner of smart card tender the first batch of which are due before the end of the year. Home Affairs Minister, Shamsi Vuai Nahodha challenged NIDA earlier this year to ensure that national IDs are issued no later than this year.

The 149 million US dollars (approx. 223bn/-) national IDs project has stalled for years now.

During Tuesday’s launching of the bankers survey report, Mafuru commended Serengeti Advisers for coming up with the insightful and informative report that will not only assist bankers know the market that they operate in but also enable regulators identify key players and their character.

Mafuru denounced nationals who take bank loans as grants and evade repayment saying such people are the reasons behind hiked lending rates among banks in the country.

“Between 10-12 per cent which banks charge on loans is risk return,” the NBC chief executive pointed out.

Presenting the five year survey findings which started in 2006, Serengeti Advisers Director, Aidan Eyakuze said the country’s banking sector is strong and has maintain robust growth over the period.

Mr Eyakuze said despite the global financial crisis of 2008/10, local banks maintained steady growth though only ten among the 41 banks and financial institutions which are directly regulated by Bank of Tanzania dominated the market with an 80 per cent of all activities.

“The banking sector’s total assets have expanded 2.8 times from 5.5trn/- to 15.3trn/- while deposits also grew 2.8 times from 4.4trn/- to 12.4trn/- over the same period of time,” Eyakuze noted.

CRDB Bank Plc, NMB Bank Limited, Federal Bank of Middle East and National Bank of Commerce command the lead by dominating in deposits, loans, profits made, assets value, number of automated teller machines and number of people employed in the sector.

While CRDB comfortably leads the pack in almost every field, NMB remains the most widely spread bank providing services to the most remote clients in the country.

Exim Bank Tanzania Limited has been identified as the fastest growing bank in terms of deposits and loans in the past five years.

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