Mwanza/Dar. While agency banking services continue to attract many young people due to fast cash turnover, agents are increasingly grappling with a growing wave of fraud that is causing significant financial losses across the sector.
Although regarded as a profitable and trusted service for customers, some agents have lost millions of shillings through fraud schemes that are constantly evolving across the country.
The situation is threatening business security and eroding trust in digital financial services nationwide.
Agents say that as the use of digital payments expands, they are repeatedly falling into increasingly sophisticated fraud traps.
Speaking to The Citizen’s sister newspaper, Mwananchi, at Buhongwa Market in Mwanza, agent John Justine said losses remain severe, with some operators losing millions of shillings in a single incident, forcing others to shut down their businesses.
He said fraudsters often begin by building trust, posing as ordinary customers while carefully observing the agent’s working environment.
“Fraudsters usually start with small transactions to gauge how alert the service provider is.
Once they identify a weakness, they begin making larger withdrawals over several days before eventually stealing,” said Mr Justine.
He added that fraudsters often build trust by pretending to send money from a distance and later collecting it in person.
In some cases, they later request cash on the promise that it will be repaid quickly due to urgency.
“After repeated interactions over several days, the agent builds trust and eventually falls into the trap without realising it,” he said.
Another agent, Ms Leila Kisiel, said another tactic involves asking to use the agent’s phone, then exploiting it within minutes while claiming their own device has technical issues.
She said fraudsters insert their number and impersonate a financial institution by manipulating SMS notifications to make them appear legitimate.
“A woman was defrauded of Sh1.8 million through SMS fraud. She asked me to confirm whether she had handed her phone to a customer. When I checked, it displayed the company name,” said Ms Kisiel.
Fraudsters exploit loopholes
A financial services agent in Kariakoo, Dar es Salaam, Sifa Mwakibete, lost Sh7 million after receiving fake messages designed to appear as though they had been sent by a mobile network operator.
She said fraudsters arrived posing as customers seeking withdrawals and instructed him to verify SMS notifications after transactions, claiming his phone had storage issues and delayed messages.
“I did not realise I had given them a chance to steal from me. More than three customers came requesting withdrawals of Sh500,000 and above. This happened because I could not see messages due to a full inbox,” said Ms Mwakibete.
She said the fraudsters coordinated their actions, taking turns withdrawing money in small amounts.
One took Sh2 million, another Sh1.5 million, while others continued transactions until the total loss exceeded Sh7 million.
Legal framework
The Banking Agency Guidelines of 2017 require agents to verify all transactions before disbursing cash, maintain customer confidentiality, prevent misuse of devices, and report any suspected fraud immediately.
The Electronic Money Regulations of 2015 require financial institutions and agents to ensure systems are protected against fraud, transaction misuse, and cyber theft.
Section 53 of the National Payment Systems Act of 2015 grants the Bank of Tanzania (BoT) authority to regulate and issue guidelines to payment service providers and agents to ensure the security of electronic financial systems.
Despite these frameworks, stakeholders say compliance remains weak due to limited inspections by regulators.
Agent Stanslaus Moshi said that while agents are given guidelines and logbooks upon registration, many fail to follow them in practice.
“To a large extent, the mistakes are ours. When registering, we are given everything, including guidelines and books, but if you go around agents today, most are not using those books to record customers’ transactions,” said Mr Moshi.
He said the situation is worsened by customer urgency, which makes it difficult to follow verification procedures, leaving gaps that fraudsters exploit.
Mr Moshi added that proper record-keeping would make it easier to trace fraudsters, especially those using mobile money systems.
“Today, SIM cards are sold anywhere, unlike before when agents were physically inspected. Now someone can move around with a phone and agent numbers,” he said.
Agent Bahati Makubi said fraudsters often offer bribes to encourage agents to bypass procedures.
“They know there is little monitoring or form filling. They bribe agents so they can be served quickly while appearing to offer extra income,” said Makubi.
Makubi added that some fraudsters are former employees of telecom companies or related sectors, which makes it easier for them to manipulate systems.
Impact on financial sector
Financial and economic expert, Ms Sophia Mussa, said rising fraud cases targeting agents are affecting the growth of small businesses and the stability of the digital financial sector.
She said the situation is undermining public trust in digital financial services and could weaken efforts to build a modern, cashless economy.
“Most agents enter this business using loans or personal savings, so when they lose money to fraud, they suffer economic collapse and sometimes close their businesses,” she said.
She called on financial institutions and telecom companies to invest more in educating agents and the public on safe use of digital financial systems.
“Technology is evolving rapidly, and fraudsters are developing new methods every day. Without continuous education and strong protection systems, this challenge will persist,” she said.
Regulatory data
Data from the Tanzania Communications Regulatory Authority (TCRA) show that between March 2025 and March 2026, a total of 62,879 SIM cards were blocked, while 60,177 National Identification Authority (Ninda) numbers were restricted from registering new SIM cards due to fraud-related cases.
The measures build on earlier efforts initiated by former Minister for Information, Communications, and Information Technology, Mr Nape Nnauye, who spearheaded a crackdown on online fraudsters.
The issue was also raised in Parliament on April 30, 2026, by Minister Angellah Kairuki during the presentation of the 2026/27 budget estimates of Sh222 billion.
On November 22, 2024, former minister Jerry Silaa said the government had agreed with the Bank of Tanzania (BoT) to strengthen supervision of financial agents, including reviewing conditions governing cash withdrawals.
Police response
The Tanzania Police Force has intensified public education on fraud prevention, targeting agents and customers.
Speaking during a training session for financial agents in Kigoma Ujiji Municipality on April 30, 2026, Police Inspector Ferister Kaywanga urged agents not to hand over transaction phones to customers.
She said doing so creates an opportunity for criminals to insert their numbers and send fake SMS notifications indicating that money has been sent.
Ms Kaywanga also urged agents to verify funds before releasing cash and ensure all transactions are fully confirmed.
She further called on agents to cooperate with security agencies by reporting suspicious activities promptly.
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