Financial policy to control higher interest rates for lending is in offing

Plans are underway to establish a national financial policy on good governance which will look together with other matters high interest rates charged by financial institutions in the country, the deputy Finance and Planning Minister Ashatu Kijaji has said. The deputy minister was responding to the supplementary question last week in Parliament which was raised special seat legislator Munde Tambwe who wanted to know plans by the government to control high interest rates being charged by financial institutions.  The legislator further noted that, despite request by President Dr. John Magufuli to financial institutions of reducing their interest rates on lending which he issued two months ago, rates charged by FINCA and PRIDE institutions are still higher and stands at 33 percent. 

Former Minister of Trade and Industries Dr. Mary Nagu

However, introducing the debate in parliament today over the reduction of interest rates by banks in the country, the legislator for Konde constituency Khatibu Said Haji (CCM), praised the CRDB Bank for having reacted in response to the president’s request and reduced its interest rate from 20 to 17 percent respectively. The deputy minister said that, the government does not have a solemn power to induce the reduction of the interest rates, but will continue providing conducive working environment which will make stakeholders work in a competitive spirit to regulate affordable rates in the market. She said the government would also continue providing legal policies that would govern their performances to the utmost levels to help the poor. In another supplementary question which was raised by Mary Nagu (CCM) which she targeted plans by the ministry of Finance to ensure that, “rates for depositing are increased by banks and not only lending rates’. In responding to this question, the deputy Finance minister noted that, the government would continue providing a friendly working environment to bankers so that they might increase such rates to make many people deposit their money.