By Azania Post
MUUNGANO Saccos in Kigoma region is contemplating to establish soap factory early next year that would enable increase income to the members and Tanzanian government.
Speaking to Azania post in an exclusive interview the Saccos chairman Sadi Tembe ,they have started preparation of the said factory.
“We have purchased a piece of land within the municipality where the construction activities would start upon availability of funds,” he said.
He urged the government and other stakeholders to support them in securing loans from public institutions.
“We understand that the government has various sources of income, there is a need to support us in this industrial move, which would help increase in employment opportunities and income to the members”, he said.
He said up to moment ,the society has accumulated a total assets of shillings 150million since it was established over ten years ago.
Statistics show that all the microfinance institutions in Tanzania serve a combined client population of about 400,000 SMEs, which is only around 5% of the total estimated demand.
The financial services to the poor and low income households in the rural and urban areas have been slow to develop and the access of these large segments of the population to financial services has remained stunted .
Despite the importance of microfinance institutions in Tanzania, most of their activities are skewed in favour of urban areas leaving rural areas grossly under served.
MFIs are therefore reluctant to extend their services to remote parts of the country, citing the high operational costs involved.
Many MFIs are also constrained by funding so they are unable to expand and therefore tend to concentrate in urban centers.
Tanzania government has been taking some initiatives to improve microfinance sector in the country in order to enable its citizen to access financial services easily.
The government realized that, for a country to have an efficient and effective financial system, additional focus must be placed on the expansion of financial services to the low-income segment of the population.
One of the important actions was initiating the National Microfinance Policy 2000 as a guideline to microfinance activities in the country.