By Charles Mkoka
LINDI, Tanzania — The Bank of Tanzania (BoT) says it will strengthen oversight of concessional agricultural lending after concerns were raised that low-cost financing intended for farmers is not always reaching borrowers at the affordable interest rates envisioned by the government.
The issue emerged during a visit by Deputy Minister for Agriculture, Hon. David Silinde to the Bank of Tanzania pavilion on Indigenous Crops and Foods Day, one of the themed events held as part of the ongoing Nanenane Southern Zone agricultural exhibition in Lindi.
During the visit, BoT Mtwara Branch Director, Moto N. Lugobi explained that the central bank does not lend directly to farmers but provides financing facilities to commercial banks and other participating financial institutions, which are responsible for extending affordable loans to farmers, livestock keepers and other priority sectors.
When concerns were raised that many farmers continue to face borrowing costs above the government's target of single-digit interest rates, BoT officials acknowledged that similar complaints had been received from stakeholders across the country.
"We have received feedback from stakeholders, and we will now follow up more closely," Lugobi said, adding that the central bank had fulfilled its role by establishing the financing facilities but would strengthen monitoring to ensure the intended benefits reach farmers.
The discussion underscored the importance of affordable agricultural finance as Tanzania seeks to modernise the sector, increase productivity and improve food security under the country's long-term agricultural development agenda.
The Bank of Tanzania is among institutions participating in this year's Nanenane exhibition to showcase initiatives supporting financial inclusion, agricultural financing and broader economic development.
The Southern Zone exhibition continues through August 8 in Lindi.
