Online banking services
FinTechs belonging to this area offer traditional banking services in a modern way, usually through online services or mobile applications as well as ancillary services – e.g. enabling customers to manage their giro- or custody-accounts online and in real time or offering e-wallet services. Keywords in this context are also API-Banking or Banking as a Service (BaaS)/ Bank as a Platform (BaaP).


API stands for application programming interface and is offered to access data banks and to extract and insert information. API-Banking consequently means the access to data banks of banks to offer new and innovative banking applications.

Through these services FinTechs offer services with new functions, e.g. enabling customers to manage their accounts online and in real time.

BaaS – Bank as a Service/BaaP – Bank as a Platform:

The API-based Bank as a Service platform has a full banking licence, but merely serves as the back end for standalone independent FinTechs, which “use” the licence and the back end of the bank to offer new financial services, launch additional financial products or expand into additional markets.


Attitude of the country towards online-banking services

The social and political climate towards online banking is very favourable, and currently, given the several advantages, the adoption rate is rising rapidly. On the other hand, the government has put in place some frameworks such as the National Financial Inclusion Framework 2018-2022, to leverage the potential of the FinTech sector to expand digital financial services.

One of the reservations is in respect to customers regarding online banking as an expensive service, because in order to use online banking, one needs to have a smartphone or a computer which not all customers can afford. 

More so, some customers have lost funds from online banking and recovering has been hard because in situations where their own credentials were used in stealing such funds, the bank would not refund such a customer. This has made some customers shy away from online banking and stick to traditional banking which they consider safer.

Legal affairs

Obligations and requirements to provide online-banking services described above

The obligations and requirements to provide online banking are enforced by the Central Bank of Tanzania. The central bank licenses, regulates and supervises all banks and financial institutions. It also regulates payment systems. Every applicant of online banking service must comply mainly with National Payment System’s Act, 2015, Electronic Transaction Act, 2015, Anti- Money laundering Act 2019. Under these regulations, the applicant must submit a business plan, must disclose the source of funds, document polices for detecting and reporting money laundering activities, process flow and system architecture, among others.

Tanzania Communications Regulatory Authority (“TCRA”) issues and renews licenses. TCRA regulates communication services, for example telecom, broadcasting and postal. In regulating TCRA supports the central bank on the technology side. For example, for any FinTech services the applicant needs two licenses; one is issued by the central bank and another by TCRA. Once the applicant fulfils the requirements imposed by these regulators, they would legally run their online banking affairs.

Costs vary depending on the exact license.

Additional comments regarding the legal situation for online-banking services or what FinTech’s must be aware of in this business area

The advantages associated with internet banking would benefit both the customers and enhance the banks’ reputation. Bringing awareness ab
out internet banking services to customers will not only increase internet banking users but also retain customers due to this advancement. Effective ways of publicising the internet banking services using all possible kinds of media such as brochures, leaflets and web pages will help to introduce the services to a broader audience and educate prospective customers about the benefits of internet banking, as well as remove unnecessary doubts. It is also important to have a user-friendly website for easier use by the new users. To be successful, it is expected that the customer should not need to spend a lot of effort or time or undergo a great change in behaviour when adapting to internet banking services. Vital information and instructions should be provided, on the web both in English and Swahili in order to make the adopter contented. The emphasis of benefits and usefulness of internet banking should be done by demonstrating these services.

Economic conditions

Market size for online-banking services and biggest companies in this business area

It is hard to estimate this on its own because all banks offer both traditional and online banking services. Most reports that have been issued show the combined market size. The biggest companies in online banking are Standard Chartered, Stanbic Bank Tanzania Limited, Absa Bank Tanzania Limited, Diamond Trust Bank and NMB Bank.

Additional comments regarding the economic situation for online-banking services or what FinTech’s must be aware of in this business area

FinTech Companies must be aware that FinTech is still at its growth stage in Tanzania since few people are accustomed to the use of electronic channels to manage their financial affairs hence the low adoption on FinTech. A lot of awareness is needed to break the traditional norm of banking. 

FinTechs should know as well, that this area is heavily regulated and when applying for licenses, they should never be in a rush, due to the bureaucracy involved in processing. Some licensing proceedings can even go up to a year before the actual granting of a license. However, the ground for FinTech is still very unexploited in Tanzania.



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