TANZANIA Teachers' Union To Officially Launch Teachers Bank

Tanzania Teachers' Union

TANZANIA Teachers' Union (TTU) plans to officially launch its commercial bank next December, a move that is expected to avail teachers with access to affordable loans.

TTU President Gratian Mkoba told the 'Daily News' in Dar es Salaam that the financial institution will bring to an end the woes that teachers experience through expensive credit facilities, sometimes from unrecognised institutions.

"The expensive loans have never helped teachers to improve their living standards... if anything, such loans have only subjected our members to heavy debts whose servicing leaves teachers without salaries," said Mr Mkoba.

He said the union is through with all the requirement and that it is the Bank of Tanzania (BoT)--the industry regulator-- that is being waited to grant the licence for the teachers' bank to go into business.

TTU has already raised the 15bn/- capital requirement by the central bank, Mr Mkoba said.

The union has over 180,000 members as a special target market but after the bank launch for business, the door would be open for teachers from the private sector to join.

The president said the teachers' body plans to convince the government to pay teachers' salaries through their own bank as a strategy to boast deposits and strengthen the bank's lending capacity.

He said the envisaged bank will be headquartered in Dar es Salaam and gradually move to other regions-- Mbeya, Mwanza, Arusha and Dodoma--with the views of taking the banking services close to the members.

Recently, the Deputy Minister for Education and Vocational Training, Mr Phillip Mulugo was quoted as saying that TTU plan to establish the bank was progressing well.

Mr Mulugo explained that TTU saw it important to provide loans to teachers from the two per cent deducted from their monthly salaries to help improve their lives, hence the idea to establish the teachers' bank.

And, according to the deputy minister, the bank will provide loans at low interest, compared to other financial institutions that operate commercially.