The kinds of loan you can get in Tanzania

Which loan fits depends on when the money comes back

A vitenge seller at Kariakoo needs stock before December. A rice farmer in Mbarali has fertiliser to pay for in January. Both need a loan, but not the same one: the stall earns money back every week, while the rice field earns nothing until harvest.

So before you compare rates, match the repayment to the day your money arrives. An installment (rejesho) that falls due before your income comes in gets paid late, or out of money meant for something else, however good the rate. The table shows who may offer each kind of loan and where this site covers it in more depth.

Who is allowed to lend to you

Most lenders in this guide sit in Tier 2 under the Microfinance Act, 2018. The Bank of Tanzania licenses them to lend, and without its authorisation they may not accept deposits (regulation 22(a) of the Tier 2 regulations, GN 679). The four tiers, and where to check a lender in each, are in How to check a lender is licensed. Regulation 3 of GN 679 names five kinds of Tier 2 lender:

• Credit company. A company incorporated under the Companies Act and licensed for microfinance business (section 3 of the Act).
• Financial organisation. An organisation incorporated or registered under the relevant laws and licensed for microfinance business (section 3).
• Individual money lender (mkopeshaji binafsi). One person trading under a registered business name (regulation 4(b)). Under regulation 23(3) this kind of lender may not hold cash collateral, cash guarantees, loan insurance guarantees or compulsory savings.
• Housing microfinance company. Lends to households to build, repair or improve a home (the definition of a housing microfinance loan in regulation 3).
• Digital microfinance lender. Handles the whole loan, from application and approval to payout and repayment, through digital channels (regulation 3).

Regulation 21 sets out what a Tier 2 lender may do. The list includes loans to individuals, to groups of individuals and to micro and small enterprises, housing microfinance, micro leasing, microfinance hire purchase, and selling micro insurance as an insurer's agent. The Bank's annual supervision report counted 2,342 licensed Tier 2 providers at the end of 2024, and their outstanding loans came to TZS 1,073.3 billion.

Commercial banks sit outside the four microfinance tiers. They are licensed under the Banking and Financial Institutions Act, and GN 679 does not bind them, because its regulation 2 limits it to Tier 2. The Bank's Financial Consumer Protection Regulations do reach them. Regulation 2, as amended by GN 298 in 2025, applies those regulations to each financial service provider the Bank has "licensed or supervised and regulated", so they cover banks and Tier 2 lenders alike.

The Microfinance Act itself covers Mainland Tanzania only (section 2). In Zanzibar, ask the lender which law licenses it.

Business loans: match the installments to your takings

A business loan pays for stock, a supplier's bill or the gap between paying out and getting paid. Regulation 21(a) lets Tier 2 lenders lend to micro and small enterprises, and banks and SACCOS lend for business too. The first thing to settle is how often you repay.

Weekly repayment fits a business that takes cash every day, such as a mama lishe's food stall or a duka in Mbagala. It hurts a business that is paid in lumps. Imagine a carpenter in Dodoma who makes desks for a school on 30-day invoices: his first weekly installment falls due weeks before the school pays him. If your money comes monthly, ask for monthly installments and explain why.

Ask early what the lender will hold as security (dhamana). Some lenders take compulsory savings, cash you leave with them while the loan runs. For a Tier 2 lender, regulation 23 of GN 679 requires that cash to sit in its own bank account, bars the lender from lending it or using it for anything else, and requires a refund once you have met your loan obligations. Compulsory savings also cut the cash you can actually use, and Comparing two loan offers works through an offer like that in shillings.

Group loans, VICOBA and SACCOS

A group loan agreement can make each member answer for the others' installments, so read what yours says about a member who stops paying. If the lender is Tier 2, regulation 44(3) of GN 679 counts the whole group loan as past due once one member defaults and the rest of the group does not make up the shortfall. Join a group (kikundi) only with people whose installments you would be willing to pay.

A VICOBA or a SACCOS lends out its members' own money, under different rules. A community microfinance group (Tier 4) is formed by 10 to 50 people with a common bond, grants loans to its own members and may not accept savings from outsiders (regulations 4(2) and 19 of GN 678). A SACCOS (Tier 3) is licensed through the Tanzania Cooperative Development Commission, and its board sets the interest rate, fees and penalties on loans unless the members' general meeting decides otherwise (regulation 36 of GN 675).

At the end of 2024 the Bank's report counted 58,926 registered community groups and 964 SACCOS (another section of the same report gives 959). How to choose between a group, a SACCOS and a licensed lender is in VICOBA, SACCOS and microfinance.

Salary loans: count what is left after deductions

If you are employed, a lender may lend against your salary and collect each installment through your employer's payroll. In Mainland Tanzania, section 28(1)(b) of the Employment and Labour Relations Act lets your employer deduct a loan installment from your pay if you have agreed to it in writing; for any other deduction the employer needs a written law, collective agreement, court order, arbitration award or wage determination that requires or permits it (section 28(1)(a)). Keep a copy of the deduction form you sign.

Read your payslip before you read the offer. If you still owe the Higher Education Students' Loans Board (HESLB), part of your pay already goes to it: HESLB's loan repayment page tells employers to deduct 15% of basic salary for the beneficiaries it has billed. On a basic salary of TZS 800,000 that is TZS 120,000 a month, gone before any new installment. The affordability calculator shows how big an installment the rest can carry, and A budget that survives the repayment builds a month around it.

Ask the lender, in writing, what happens to the loan if you change employer or lose the job. If a Tier 2 lender later offers you a top-up, it may not charge a fee for it: guideline 17(2)(f) of the Bank's 2024 fees guidelines bans fees for a top-up, refinancing or loan enhancement. Fees a microfinance lender may not charge you has the full banned list.

Asset finance: a bajaji, a freezer or a sewing machine

Here the loan buys one named item, which then secures the loan. Regulation 21(e) lets Tier 2 lenders run micro leasing and microfinance hire purchase. Section 3 of the Act defines micro leasing as finance leasing in which the average asset in the lender's portfolio is worth up to TZS 10 million and the lease runs for no more than 24 months. The Bank separately licenses financial leasing companies, which its 2024 report says offer asset finance through leases; it counted four, with 11 branches, at the end of that year.

Before you sign, get answers to three questions:

• Whose name is on the registration card until the last payment?
• What may the lender do on the day a payment is missed?
• Is insurance compulsory, and who chooses the insurer?

On the last one, guideline 14 of the fees guidelines limits what a Tier 2 lender may charge you for insurance to the premium the insurer actually charges, and bans any insurance charge when no licensed insurance company covers the loan. Buying a bajaji or motorcycle on credit works through a boda boda deal in shillings, including the registration card and what happens to the bike after a missed payment.

Farm loans: paying at harvest instead of every month

A crop earns its money at harvest. A loan that suits it asks for little or nothing while the crop grows and is settled once the crop is sold. With monthly installments from the first month, you pay from other income through the months the field earns nothing. Take a TZS 1,000,000 loan for six months at 3% a month, a rate chosen for this example and not a market figure:

The harvest loan costs TZS 72,415 more in shillings, yet its true yearly rate is lower, because you keep the whole million for all six months. Put your own offer into the loan calculator, and ask the lender to write down what happens if the rains fail.

The Tanzania Agricultural Development Bank (TADB) lends through partner institutions, which its website lists as NMB, CRDB, Azania Bank, TCB, Uchumi Commercial Bank and SELF Microfinance. It names cooperatives and agricultural marketing cooperative societies (AMCOS) as its partners in getting finance to smallholders.

According to The Citizen of 1 August 2026, the warehouse receipt system covers 18 crops and products in 23 regions. Its regulator, the Warehouse Receipts Regulatory Board (WRRB), says it is strengthening partnerships with financial institutions so that farmers can borrow using warehouse receipts as collateral.

Phone and app loans

An app or USSD loan may show its price as a fee rather than a rate. A lender that runs every step through digital channels is a digital microfinance lender under regulation 3 of GN 679. Under paragraph 3.1(a) of the guidance note on digital lenders that the Bank issued in August 2024, the first requirement such a lender must meet is a Tier 2 licence. Paragraph 3.1(f) makes the app display the rate, fees, late penalty, payment frequency, loan limit and tenure for every product before you apply.

If the app belongs to a Tier 2 lender, look it up on the Bank's list of approved platforms and on its list of unapproved apps before installing it. Only Tier 2 lenders' platforms appear on the approved list, so you won't find a bank's own loan app there.

Is this loan app approved? shows the check step by step, and Mobile-money and app loans: what the fee really costs turns a fee into a monthly and a yearly rate.

Housing loans: from one room to a mortgage

Housing microfinance is a Tier 2 product. GN 679 defines a housing microfinance loan as a secured or unsecured loan to a household, in a rural or urban area, to build, repair or improve a house. That covers a plan such as adding two rooms in Mwanza, or roofing walls you have already built.

A mortgage is a far larger loan against a titled property. The Tanzania Mortgage Refinance Company's update for 30 September 2025 counted 29 banks and financial institutions reporting mortgages, an average mortgage debt of TZS 124.17 million, and typical mortgage rates ranging between averages of 15% and 19%. The Bank's 2024 report names First Housing Finance (Tanzania) Limited as the licensed mortgage finance institution that lends directly to the public. Banks' overall lending rate in February 2026 was 15.11% a year, as published in the Monthly Economic Review for March 2026.

Either way, a lender can sell a house pledged as security when the loan goes bad. For a Tier 2 lender, regulation 41(3) forbids selling mortgaged property until 60 days after a written demand. Collateral and guarantors: what you can lose covers what else a lender may and may not do with pledged property.

Student loans and the council 10% loans

For university, HESLB lends to students. Its guidelines for bachelor's degree students in 2026/2027 cap tuition at TZS 3,100,000 a year, with separate amounts for meals and accommodation, books and field practicals. Applications for that year opened on 19 June and closed on 31 August 2026; the next window is announced in new guidelines each year.

The guarantor (mdhamini) must give a National Identification Number or a Zanzibar Resident ID, and if the student defaults, the guarantor is responsible for settling the unpaid loan in full (guideline 9.2). Borrowing for school fees below university level, or for a hospital bill, is covered in A budget that survives the repayment.

The council 10% loans come from section 37A of the Local Government Finance Act (Cap. 290, revised 2019). It requires every local government authority to set aside 10% of the revenue it collects from its own sources as loans to registered groups: 40% for women, 40% for youth and 20% for people with disabilities. Section 37A(3) says these loans shall not carry any interest, and the procedure is left to regulations under section 37A(4), so ask your council how its groups apply.

Be wary of loan apps that borrow a leader's name. The unapproved list mentioned above includes one called "Mama samia mikopo foundation".

Checks that apply to every kind of loan

1. Find the lender on the Bank's register. Kopesha's directory lists the lenders on the Bank's Tier 2 register of 14 August 2026, region by region and district by district. Any listing marked "Not on the register" was added by the lender itself, and that lender is not on the Bank's list. A SACCOS is checked with the Tanzania Cooperative Development Commission, and a VICOBA with the council that registered it.
2. Get the true cost on paper. A Tier 2 loan agreement must state the nominal annual rate, every fee, the effective annual rate with fees included, and how interest is computed (regulation 39(2) of GN 679). What a loan really costs shows what each figure means.
3. Ask about paying early. You may repay a Tier 2 loan early, all of it or some, without warning the lender and without a penalty; clear it in full and no interest is owed for the months left (regulation 42(3) and (4)). Guideline 15 of the 2024 fees guidelines lets a Tier 2 lender charge for settling early only when that fee is clearly written into your agreement, so look for the clause. Getting out of debt you already have says how to raise such a fee with the lender.
4. Compare at least two written offers side by side with the offer comparison tool.

To have lenders contact you instead, use Kopesha's free call-back request: lenders in your region that hold a Kopesha account can see it and call you, though Kopesha cannot promise that any will. It is not a loan application, and Kopesha does not lend or vouch for any lender.

Sources

• Microfinance Act, 2018 (Act No. 10 of 2018): sections 2, 3, 5, 14, 18 and 28 — Bank of Tanzania
• Microfinance (Non-Deposit Taking Microfinance Service Providers) Regulations, 2019, GN 679: regulations 2, 3, 4, 21, 22, 23, 39, 41, 42 and 44 — Bank of Tanzania
• Microfinance (Savings and Credit Cooperative Societies) Regulations, 2019, GN 675: regulation 36 — Bank of Tanzania
• Microfinance (Community Microfinance Groups) Regulations, 2019, GN 678: regulations 4 and 19 — Bank of Tanzania
• Guidelines on Fees and Charges for Microfinance Service Providers, 2024: guidelines 14, 15 and 17 — Bank of Tanzania
• Guidance Note on Digital Lenders under Tier 2 Microfinance Service Providers, 2024: paragraph 3.1 — Bank of Tanzania
• List of approved digital lending platforms operated by Tier 2 providers (copy downloaded 28 September 2026) — Bank of Tanzania
• List of digital lending platforms and apps not approved, as at 28 February 2026 — Bank of Tanzania
• Register of Tier 2 Microfinance Service Providers as of 14 August 2026 — Bank of Tanzania
• Banking Supervision Annual Report 2024 — Bank of Tanzania
• Monthly Economic Review, March 2026: interest rates (section 2.3) — Bank of Tanzania
• Bank of Tanzania (Financial Consumer Protection) (Amendment) Regulations, 2025, GN 298: regulation 2 — Bank of Tanzania
• Employment and Labour Relations Act, Cap. 366 R.E. 2019: sections 2 and 28 — ILO NATLEX copy
• Local Government Finance Act, Cap. 290 R.E. 2019: section 37A — Ministry of Finance
• About Loan Repayment — Higher Education Students' Loans Board
• Guidelines and criteria for issuance of loans to bachelor degree students, 2026/2027 — HESLB
• Partners — Tanzania Agricultural Development Bank
• Tanzania Mortgage Market Update, 30 September 2025 — Tanzania Mortgage Refinance Company
• Warehouse receipts system generates Sh2.3 trillion for Tanzania farmers, traders — The Citizen, 1 August 2026

What changed

• 29 September 2026: Rewritten as a guide to every kind of loan, with links to the guide that covers each, and moved from the cost category to options. Corrections: removed five claims with no source behind them (that salary loans usually carry a lower rate; that trouble starts once deductions pass roughly a third of take-home pay; that group loans are how a great many Tanzanians get their first formal loan; that asset finance is often the cheapest way to buy equipment; and that a phone loan's fee over 30 days is normally worth more than any monthly rate quoted elsewhere). The group-loan section now cites Regulation 44(3) of GN 679, under which the whole group loan counts as past due when one member defaults and the others do not cover the amount, and tells readers to check what their own group agreement says about a member who stops paying. Added: the kinds of Tier 2 lender in Regulation 3 of GN 679 and what they may do (Regulations 21 to 23); housing microfinance and mortgages (TMRC, 30 September 2025); digital lenders and the Bank's approved and unapproved app lists; SACCOS and community group rules (GN 675 and GN 678); payroll deductions (Employment and Labour Relations Act s.28); HESLB 2026/2027 amounts and guarantor liability; the interest-free council 10% loans (Local Government Finance Act s.37A); TADB partners and warehouse receipts; a monthly versus harvest repayment table; the early-repayment rule (Regulation 42(3) and (4)) with fees guideline 15; and a list of sources.
• 19 September 2026: First published.

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