TCDC suspends tobacco insurance amid farmers’ complaints

MOROGORO: THE government, through the Tanzania Cooperative Development Commission (TCDC), has suspended insurance cost deductions on tobacco that have been applied by financial institutions through agricultural input loans pending new and mutually agreed framework is established.

Registrar and Chief Executive Officer of TCDC, Dr Benson Ndiege told reporters that the suspension follows numerous complaints received from tobacco farmers regarding the deductions.

He explained that the goal of the Commission, along with the involved financial institutions, is to come together and establish a proper framework that will benefit farmers, unlike the current situation.

“We have taken this step in response to many complaints from farmers and challenges surrounding this crop insurance. Farmers do not understand why they are being deducted two per cent without knowing what benefit it brings them,” said Dr Ndiege.

He added that upcoming measures will include setting clear criteria for tobacco crop insurance, establishing all necessary procedures and reviewing the costs charged by banks or deductions made from farmers for the insurance.

“We are suspending the deductions in order to first establish a proper system through the Commission. In collaboration with the banks providing the insurance, we aim to agree on a clear structure for the process, while also educating farmers. There have been numerous complaints, particularly because farmers do not understand why 2 per cent is being deducted without any explanation,” explained Dr Ndiege.

He added that the Commission will also focus on building adequate awareness among farmers, so they understand the importance of crop insurance, why they are being charged a certain percentage and how it is intended to benefit them.

On the matter of interest rates on loans issued by financial institutions to cooperative societies, Dr Ndiege insisted the need for transparency and clarity for authorities, cooperatives and farmers alike.

He further called on all tobacco buyers during the 2025/2026 marketing season to pay farmers in accordance to the required procedures, through cooperative societies.

He urged cooperatives to pay all outstanding dues to tobacco farmers as per the agreed payment arrangements and to promptly settle all input debts for the 2024/2025 farming season.

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For her part, Assistant Registrar of Cooperative Societies for Morogoro Region, Cesilia Sostenes, confirmed that assistant registrars across the country have received directives from the Registrar and Chief Executive Officer regarding various issues and that they will implement them diligently to strengthen cooperatives and improve the livelihoods of farmers.