Tanzania scraps card payment fees in push for cash-lite economy

Tanzania says card payments in the country will remain free of extra charges as it seeks to encourage digital and electronic financial transactions.

The country’s central bank said in a notice that payments made using bank cards (debit, credit or prepaid) at any point-of-sale machine should not attract fees, and warned merchants of unspecified penalties for violations.

Emmanuel Tutuba, the Governor of the Bank of Tanzania (BoT), said that, “the central bank continues to take various measures to promote the use of digital payments in the country, and one of these measures is to ensure that payments made using point of sale (POS) machines are facilitated.”Their adoption, he said, will help build a cash-lite economy, while offering the benefits of enhanced security, transparency and ease of use.

“In case anyone has encountered any charges or surcharges while making payments at a POS terminal, the BoT is requesting the affected parties to report the issue to the bank immediately or report at its customer complaint desks.”Digital payments and the general growth of the financial sector are key pushers for the economy, even though card payments use has generally been low in the country.

According to the communications regulator TCRA, most Tanzanians use mobile money, with latest data showing some 55.8 million mobile money accounts, doubling from 25.8 in 2019. This means that eight out of ten Tanzanians have access to mobile money.

The World Bank has recently noted that the country’s medium-term outlook will remain positive, with GDP “growth expected to align more closely with its long-term potential (estimated at around six percent), supported by ongoing structural reforms and an improved business environment.

Sectors such as manufacturing, electricity, construction, tourism, trade and financial services will be key pillars of this growth, the bank said in its latest bulletin.

The BoT said the public should adopt card payments as a convenient means of transaction

SOURCE: ZAWYA