Tanzania’s private sector credit continued to register strong growth at 20.1 per cent in July this year compared with 19.4 per cent recorded in June this year, the Bank of Tanzania (BoT) said in the Monthly Economic Review for August released yesterday.
According to the Central Bank, The increase in private sector credit growth continues to be backed by improved business environment in the country, recovery of private sector activities from the effects of COVID-19, and supportive fiscal and monetary policy conditions.
During the year ending July 2022, all major economic activities recorded growth of credit, save for hotels and restaurants.
“Credit extended to agriculture sector recorded the highest growth for the second consecutive month. This is attributed to additional monetary policy measures that were rolled out by the Bank in July 2021 to support credit growth to agriculture activities,” the report said.
Other economic activities that registered strong growth of credit include mining and quarrying, manufacturing and personal business undertakings.
Meanwhile, personal undertakings continued to account for a lion share at 38.3 per cent of outstanding credit, followed by trade, manufacturing and agriculture activities
Meanwhile, Interest rates charged on loans by banks remained almost unchanged in July 2022, with overall lending rate averaging 16.18 per cent, compared with 16.22 per cent registered in the previous month.
Lending rate charged on prime customers (negotiated lending rate) averaged 14.23 per cent compared with 14.25 per cent recorded in the previous month.
Likewise, deposits interest rates remained virtually unchanged in July 2022, with overall deposit rates averaging at 7.56 per cent, compared with 7.35 per cent recorded in the preceding month.
However, the rate was slightly higher than 6.80 percent recorded in the corresponding period in 2021