NMB, govt for single-digit loans using ‘machinga IDs’

ARUSHA: NMB Bank, in collaboration with the government, is set to provide single-digit interest loans to micro, small and medium enterprises (MSMEs) through the use of digitalised ‘machinga’ IDs.

The initiative follows the government’s signing of an 18 billion/- agreement with NMB Bank to support the programme.

These loans, offered at a competitive 7.0 per cent interest rate, will be accessible to entrepreneurs who hold the newly issued digital ‘machinga’ IDs, officially launched recently in Arusha.

The IDs serve as a guarantee for loan applications, facilitating easier access to financial support for MSMEs.

The Minister for Social Development, Gender, Women and Special Groups, Dr Dorothy Gwajima said when distributing the IDs that the fee is only 20,000/- and renewable after every three years.

“These IDs will give you an opportunity to take loans from NMB…

Dr Gwajima highlighted that the digital IDs are recognised by all government authorities and serve as proof of legitimate business activity. The IDs also link MSMEs to key government institutions, including NIDA. Unlike the previous ‘machinga’ IDs, the new digital versions come equipped with a chip that enables users to access banking services locally and internationally, as well as make payments at Point of Sale (PoS) terminals.

According to the 2022 census, Tanzania is home to 1.5 million MSMEs, with 41,977 already registered under the new system between March and September this year. The government has also allocated an additional 5.0 billion/- to enhance market infrastructure and build offices for small traders across the country, ensuring the sector’s formal recognition and providing leaders with adequate facilities for meetings.

Dr Gwajima further instructed leaders of the Small Business Federation (SHIHUMA) to educate their members on the benefits of registering and acquiring the IDs, which would allow them to access loans from NMB Bank and other financial services.

The Permanent Secretary in the Ministry of Community Development, Gender, Women and Special Groups, Dr Seif Shekalaghe, hailed the initiative as a game-changer for MSMEs, particularly for special groups. “The distribution of these IDs will streamline loan processes and simplify various procedures,” he said.

Arusha Regional Commissioner, Mr Paul Makonda, expressed gratitude to the government for selecting Arusha as the launch site, noting that it reinforces the region’s status as a key hub for both MSMEs and large businesses.