Tanzania’s 2024 Financial Trends

In 2024, Tanzania's financial landscape experienced significant developments, this year, we saw a major shift in how money moves, how banks profit, and how businesses adapt. These changes have been instrumental in steering the nation's economic trajectory and enhancing its financial stability. Whether you’re an investor, entrepreneur, or decision-maker, understanding these trends isn’t just interesting—it’s essential.

January 2024 kicked off with the Bank of Tanzania (BoT) rolling out its long-awaited interest rate-based monetary policy framework, moving away from the old monetary aggregate approach. The benchmark interest rate started at 5.5% in January, then climbed to 6.0% in April before holding steady for the rest of the year.

What did this mean? Borrowing got pricier, interbank lending saw some turbulence, and businesses had to rethink their financing strategies.

For a business owner or investor, higher rates meant it was time to optimize cash flow, reduce unnecessary debt, and explore alternative financing options like venture capital and strategic partnerships.

Despite global economic uncertainties, the Gross Domestic Product (GDP) experienced a year-on-year growth of 5.6% in the first quarter, building upon a 5.1% growth rate in 2023. This upward trajectory was primarily driven by robust performances in manufacturing, electricity, construction, tourism, trade, and financial services. The inflation rate stayed low, drifting to 3.1% in September, well below the 5% target.

However, businesses faced hurdles: global supply chain disruptions, fluctuating forex rates, and commodity price shifts. The government responded with pro-business policies, but agility was key for companies navigating these shifts

The Tanzanian banking sector experienced unprecedented growth in 2024, with total net profits surging to TZS 2.14 trillion, up from TZS 1.57 trillion in 2023. This remarkable 36% increase underscores the sector's resilience and robust economic fundamentals.

Leading the sector, NMB Bank reported a net profit of TZS 643.8 billion in 2024, an increase from TZS 545.2 billion in 2023. CRDB Bank followed closely, posting a net profit of TZS 550.8 billion, rising from TZS 422.8 billion the previous year.

The banking industry's total assets reached TZS 63.5 trillion in 2024, reflecting a strong expansion in the sector. Additionally, the Non-Performing Loans (NPL) ratio improved to 4.4% in May 2024, below the tolerable level of 5% and down from 5.5% recorded in the corresponding period in 2023, indicating enhanced asset quality.

If you weren’t taking advantage of high-interest savings, smart investments, or negotiating better loan terms, you left money on the table. It’s time to re-evaluate how you interact with banks to maximize financial growth.

The Tanzanian government implemented several fiscal reforms aimed at improving the business environment and attracting investment.

Tanzania became a hotspot for Foreign Direct Investment (FDI), raking in $3.5 billion in 2023/24. Why? New policies made the country more attractive, and infrastructure investments boosted confidence. This surge underscores the growing confidence of international investors in Tanzania's economic prospects.

But smart money wasn’t just coming from abroad. Local investors started taking notice, with increased activity in real estate, fintech, and manufacturing.

The Tanzanian shilling faced some pressure during the year, yet the BoT's interventions helped maintain relative stability. Gross official reserves remained robust, providing adequate import cover and bolstering confidence in the country's external position.

Looking ahead, Tanzania's economic prospects appear promising. Projections indicate that the economy is set to grow by about 6% in 2025, up from an estimated 5.4% growth in 2024. This anticipated growth is expected to be driven by continued expansion in key sectors such as agriculture, manufacturing, and tourism, supported by public investments and ongoing reforms aimed at improving the business environment.

One thing is clear: Tanzania’s financial landscape is changing fast. The winners in 2025 will be those who stay informed.