The central bank of Tanzania in East Africa plans to launch a new payment system called the Tanzanian Instant Payment System (TIPS) in February 2022. This payment system would enable seamless, easy transfer of funds between banks and other digital operators of financial services. The plan initially was scheduled to go live last month (December 2021) but was postponed due to necessary upgrades. According to the director of Bank Of Tanzania Bernard Dadi, “we started a pilot project in June that took on board three banks and two mobile companies - Airtel and Tigo”. He added that Vodacom is expected to come on board.
The Bank Of Tanzania introduces TIPS, which is limited to users in the East African nation, to tackle the complexity users of various digital financial services are facing making transfers. Users based in Tanzania have to deal with multiple redirections in funds transfer from one digital outlet to another. TIPS will unify users of all digital services under one platform. This way, users who want to make a transfer have to search the name of the registered recipient in the system.
The Tanzanian Instant Payment System will promote financial inclusion by giving individuals and businesses easy access to financial products and services. For digital payment systems like Airtel Money, Tigo, M-Pesa and T-Pesa, we predict a reduction in tariffs for its partnership with the Government of Tanzania in tackling digital service challenges.
Tanzania in focus
Population: 59.73 million in 2020 as compared to 58.01 million in 2019
GDP: $62.41 billion compared to $61.14 billion in 2019
GDP per capita: $1,076 in 2020 compared to $1,085 in 2019
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