Credit extended to the private sector and central government by the banking system grew at an average of 20 per cent in the quarter ending June 2022 compared with 10.2 per cent recorded during the same period last year according to the Bank of Tanzania (BoT) Quarterly Economic Review for Q,2 2022.
According to the Central Bank report, credit extended to the private sector grew at around 16 percent, the highest in the past five years, and significantly higher than 4.4 per cent recorded during the same period last year.
“The strong growth was largely attributed to improved business conditions, recovery of economic activities, as well as supportive monetary and fiscal conditions,” the report said.
Credit to agriculture, mining, personal loans primarily to micro, small and medium undertakings, trade, and manufacturing registered the highest growth rates according to the report.
“Personal loans as well as loans to trade, manufacturing and agriculture continued to account for the largest share of outstanding credit to private sector,” it added.
Meanwhile Interest rates charged on loans and those offered on deposits by banks remained broadly unchanged with the overall lending rate averaging at 16.2 per cent and that of one-year loan at around 16 per cent.
“Negotiated lending rates was 14.2 per cent, almost unchanged from the corresponding quarter in 2021. The overall and one-year time deposit interest rates were at around 7 per cent and 8 per cent, respectively,” the report added.
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