The government’s vision of creating a million dollar mining industry has begun to take the right course. This is after the NMB Bank launched a special mining club to deal with the unique monetary needs in the industry, including offering to give key players in the sector soft loans.
For any country to create a friendly and sustainable mining sector there is need to attract financial players who will introduce new financing initiatives and as a result boost the sector’s contribution to the economy. NMB Bank became the first such-like party for Tanzania.
In her first 100 days in office, Tanzania president, Samia Suluhu Hassan has done everything in her power to support the thriving mining sector according to the sixth phase government endeavour; which the special mining club initiative aligns well with.
By May 2021, loans totalling to 63bn/- had been extended to borrowers in the mining sector. NMB Bank purposes to add on to the credit given to the mining sector to exceed 200bn/- by 2025.
This new incentive to the mining sector is excellent news for more than 1.5 million miners in Tanzania, who have previously been labelled not viable for loans by merchant lenders.
Speaking during the official launch of the NMB mining club, Minerals minister Dotto Biteko challenged local lenders to follow suit and form coalitions that will enable them to provide loans for mining projects. He also commended the mining club saying that it is an innovative financial incorporation programme that exhibits top-notch creativity.
“NMB Mining Club is a commendable initiative and top-class creativity to lure new customers and serve the mining sector that has huge business potential for banks. I am grateful NMB has shown us that local lenders no longer fear working with the mining sector,” he noted.
The club already has 200 members and the number is anticipated to rise in due course. Among the benefits of being a member are business education, knowledge sharing and networking, investment lessons, and tailor-made banking solutions.
The mining industry currently accounts for more than 5.2 percent of the country’s GDP. This initiative has brought forth a new revenue avenue in the sector.