Africa-Press – Tanzania. THE government’s desire to create a friendly environment in the mining industry has started to attract financial players, and bringing forth new financing initiatives aimed at boosting the sector’s investment and contribution to the economy.
The new dawn was marked by NMB Bank that became the first lender to launch a special mining club to cater for the unique financial needs in the extractive industry, including offering sectoral players soft loans.
The mining club initiative aligns well with the sixth phase government endeavour to support the establishment of a thriving mining sector, which President Samia Suluhu Hassan has supported in many ways during her first 100 days in office.
Through this initiative, NMB Bank targets to increase credit to the mining sector to over 200bn/- by 2025. Already loans amounting to 63bn/- had been extended to the mining borrowers by May this year.
The fresh impetus into the mining sector is good news for over 1.5 million artisanal miners in the country, who have for long been considered not viable for lending by commercial lenders.
Minerals Minister, Dotto Biteko said at the launch of the NMB Mining Club that the NMB mining club is an innovative financial inclusion platform of its kind in the country, adding that it was such creativity, which makes the NMB market leader in many aspects.
He said by showing the way in serving miners better, the bank has created a new revenue avenue in the lucrative industry that currently accounts for over 5.2 per cent of national output (GDP).
He said other banks should emulate NMB and start serious lending to the mining sector for their wellbeing and that of the country.
In the drive, Mr Biteko challenged local lenders to form synergies and provide syndicated loans for financing large-scale mining projects.
“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,” the minister noted.
The Chief Credit Officer of NMB Bank, Mr Daniel Mbotto, said the club, which already has 200 members in the central zone, will contribute towards the attainment of that goal through streamlined and special lending like asset financing.
“We strongly believe mining stakeholders will seize this opportunity and capitalize on the many advantages it offers for their prosperity and productivity of the sector,” Mr Mbotto said.
Apart from offering tailor madebanking services, the novel NMB Mining Club will be a platform for spurring the sector’s growth and productivity.
The bank said its prosperity through the networking initiative will be a boon for the country.
“NMB has resolved to support the mining sector by propelling mining activities, which consequently will boost national coffers through royalty payments, service levies and other charges,” he explained.
Other major benefits of the club are business education and training programmes, networking exposure, investment and commercial lessons as well as knowledge sharing amongst members.
NMB Mining Club is a network of the bank’s mining sector customers and other stakeholders, which is initially earmarked for six areas, starting with Dodoma and Kahama that will be followed by Mwanza, Chunya, Morogoro and Arusha.
The club inauguration-cumworkshop was also organized to highlight the bank’s performance and its financial solutions like the banc assurance service offered in partnership with 10 insurers – namely Jubilee General Insurance and Jubilee Life, Reliance, UAP, Britam, Metropolitan as well as NIC, ZIC, Alliance Life and Sanlam.
The head of Business Banking at the bank, Mr Alex Mgeni, called on the government to help them serve artisanal miners by addressing several issues like allowing the lender to use their mining licences as collateral.
On his part, the chairman of the Mining Commission, Prof Idris Kikula said that was possible and the relevant authorities will look into it and advise the government accordingly.
