Responding to criticisms over the high costs of money transfers and ATM withdrawals in the country, the financial authorities have said that from October 1, 2022, Tanzanians will wave goodbye to transfer fees on withdrawal of cash through bank agents and ATMs for Tsh30,000 ($12.81) and below. This is thanks to its government.
The government is waiving transfer fees to encourage more people to use mobile money services. This is not to say that Tanzanians were never interested in mobile transactions—they were. The Tanzania MOMO market reached a value of $54.5 billion in 2021. They began to shun the technology after the government introduced transaction levies to provide basic services for its citizens in the financial year 2021/2022.
More and more Tanzanians stopped using mobile money services after the government introduced taxes on mobile money transfer and withdrawal transactions on July 15, 2021. People even took a step further and withdrew their assets from their mobile money accounts, and began paying directly with cash instead. The plummet continued until September 2021 when the government slashed the taxes it introduced by 30%. Seeing that the reduction of charges improved the situation in the mobile money scene, the government took off another 43% from its mobile money (MOMO) transaction levy three months ago. Now it has scraped the whole thing off.
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To get the money it is now foregoing in the annulment of bank charges, the government plans to reduce the expenses it makes on things like conferences, training, refreshments, and trips. Hopefully, its citizens go back to using mobile money services again and the country can grow its mobile money market to $120.4 billion by 2027, as experts predict.
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Mobile money taxes such as the one being scrapped in Tanzania have been implemented in countries like Uganda, Cameroon, and Zimbabwe. They have particularly been met with public criticism by the Cameroonian people.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry