Dar es Salaam allocates Sh14bn as special group loans set to resume
What you need to know:
- The Tanzanian government recently announced that the loans, issued from 10 percent of local government authorities' internal revenue, would resumed before November 30 this year
Dar es Salaam. The Dar es Salaam City Council has earmarked Sh14.085 billion for loans to support special groups, as the government prepares to resume issuing 10 percent loans for women, youth and people with disabilities by the end of the month.
The government recently announced that the loans, issued from 10 percent of local government authorities' internal revenue, would resumed before November 30 this year.
According to a statement released on Friday November 8, 2024 by the Dar es Salaam City Council executive director, Mr Elihuruma Mabelya, the groups eligible to apply for the loans must have both registration and certification from the relevant councils.
“Eligible groups are invited to submit their loan applications through their respective local government offices,” Mr Mabelya stated.
"Women’s groups must consist of at least five members, while groups for people with disabilities must have a minimum of two members. Additionally, members should be between the ages of 18 and 45," part of the statement read.
The loans were suspended on April 13, 2023, to facilitate a review and improvement of the loan disbursement system, in response to challenges identified in the 2021/22 Controller and Auditor General’s report.
The CAG report revealed that beneficiaries in 155 local authorities did not refund Sh47.01 billion as loan recovery.
Speaking in Parliament recently, deputy minister of State in the President’s Office [Regional Administration and Local Government], Dr Festo Dugange, said that the loans are expected to start being disbursed by or before November 30, 2024, in order to benefit the target groups.
“The government has already amended the relevant laws and reviewed the 2019 guidelines for the disbursement and management of loans for women, youth, and people with disabilities,” he said.
Dr Dugange added that activities underway include training 862 regional and local government officials on the new loan distribution and management system. Training is also being provided to loan management committees at the ward, district and local government levels, as well as to the beneficiary groups.
“Following the training, preliminary analysis of the loans has already begun in local government authorities and the loans are expected to start being disbursed by or before November 30, 2024,” he said.
The local government authorities are required to set aside 10 percent of their revenue collection to provide interest-free loans to registered groups.
Some of the issues raised by the CAG include failure to collect outstanding loans, issuance of loans to non-qualified groups, and issuance of loans before performing a detailed analysis of group repayment history and reviewing the relevant project proposals to ensure that the groups were capable of timely repaying of their loans.
The CAG also revealed that there was no close follow-up to collect the outstanding loans from the groups, a move that threatened to deplete the revolving fund.
