The banking system present in many African nations is riddled with problems making it difficult to help locals obtain financing. Some countries do not have a national identification system, which makes it difficult to identify applicants and verify credit information.
Tanzania is trying to combat this problem by creating the Credit Reference System (CRS), launched by the Central Bank, which will help in assessing loans and information on an applicant’s past credit experience. The new mechanism will compile data on clients making the information available to participating institutions.
The CRS will help mitigate risk and increase international and local investor confidence and currently, 26 banks have agreed to comply with the tool.
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