TCB’s Stawi bond to boost SME growth

DAR ES SALAAM: SMALL and Medium Enterprises (SMEs) in the country are set to benefit from a new source of affordable financing following the launch of the Tanzania Commercial Bank’s (TCB) Stawi Bond, designed to mobilise local resources for business growth and financial inclusion.

The five-year bond, carrying an attractive annual interest rate of 13.5 per cent payable quarterly, allows Tanzanians to invest from as little as 500,000/-, offering both a secure return for investors and fresh capital for TCB to extend credit to entrepreneurs and small traders.

Deputy Permanent Secretary in the Ministry of Finance Elijah Mwandumbya, represented Deputy Prime Minister and Minister for Minerals, Dr Doto Biteko, at the bond launch on Wednesday in Dar es Salaam. He noted that the bond expands opportunities for citizens to engage directly in national investment.

“This bond is more than a financial instrument; it provides a platform to enhance citizen participation in national investment, promote financial inclusion, reduce dependence on foreign borrowing and strengthen government revenues,” he said.

He commended TCB for taking a bold step through the Stawi Bond, noting that the initiative demonstrates the bank’s commitment to providing innovative solutions to the country’s financial challenges.

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The Stawi Bond has already received full regulatory approval from the Capital Markets and Securities Authority (CMSA). Chief Executive Officer Nicodemus Mkama described the bond as a milestone for the country’s financial markets and a practical instrument for SME empowerment.

“This is the first time a government-owned bank has issued such a bond, marking a major step under the Alternative Project Financing Strategy, which encourages state institutions to tap into capital markets rather than rely solely on budget allocations,” said Mr Mkama.

He noted that the value of the country’s capital markets has risen by 75.25pc in the past four years—from 31.64tri/- in August 2021 to 55.45tri/- by last month— demonstrating resilience, innovation and growing investor confidence.

CMSA officially handed over the regulatory approval to TCB during the ceremony, symbolising to both local and international investors that the Stawi Bond meets all legal and market requirements.

TCB’s Managing Director and Chief Executive Officer, Adam Mihayo said the proceeds from the bond will be channelled into expanding SME financing, reducing reliance on costly foreign borrowing and supporting low- and middleincome citizens with accessible loans.

“The Stawi Bond strengthens our ability to support small-scale traders and entrepreneurs with affordable loans, while broadening financial inclusion for Tanzanians,” said Mr Mihayo.

The product also aims to increase national income by directing local savings into productive sectors of the economy.

DSE Chief Executive Officer, Peter Nalitolela, said investors can conveniently subscribe to the bond using both TCB and DSE mobile apps from anywhere in the country.

He urged Tanzanians, including private sector players, to seize the opportunity to invest and support SME financing through the securities market.

The initiative is aligned with the Financial Sector Development Master Plan (2020/21–2029/30) and the National Economic Empowerment Policy, both of which seek to improve access to long-term financing and increase citizen participation in economic growth.

Additionally, through this bond, TCB will increase its liquidity and capital base, enabling it to serve more entrepreneurs and citizens while fostering inclusive economic development.