Tanzanian Digital Transactions Skyrocket in 2024: TIPS Handles $11.6 Billion Worth of Transactions, Enhancing Financial Accessibility
===============================================================================================
In a significant leap forward, Tanzania's digital payments landscape has witnessed a remarkable transformation, driven largely by the introduction of the Tanzania Instant Payment System (TIPS) in 2020.
TIPS, a centralised instant payment infrastructure managed by the Bank of Tanzania, has been instrumental in connecting banks, mobile wallets, and other licensed financial institutions, thereby promoting seamless money transfers and enhancing financial inclusion.
According to the latest figures, TIPS processed an impressive 454 million transactions in 2024, nearly double the 236 million recorded in 2023. This surge in transactions is indicative of the growing nationwide adoption and interoperability of the system.
From 2023 to 2024, Tanzania experienced a more than twofold increase in the value of real-time digital payment transactions, growing from TSh12.5 trillion ($4.9 billion) in 2023 to TSh29.9 trillion ($11.6 billion) in 2024.
While Tanzania's digital payment growth is noteworthy, it pales in comparison to Kenya's mobile money market. In 2024, Kenya's mobile money transactions totaled KES 8.7 trillion ($67.3 billion), over five times Tanzania’s digital payment value and accounting for more than half of Kenya’s GDP.
Tanzania's approach to digital payments is more centralized compared to Kenya's market-driven model, which is dominated by M-Pesa. However, TIPS's design contrasts with Kenya’s model, connecting diverse payment platforms and users, especially underserved communities.
Additional factors supporting Tanzania’s digital payments growth include:
- A doubling of merchants accepting digital payments in 2024, reaching 1.32 million.
- A 17.46% increase in active mobile money subscriptions to 63.21 million.
- Overall digital transaction volumes rose to 6.41 billion with values escalating to TSh198.85 trillion (~$77 billion when converting roughly at the same exchange rate), though this figure includes mobile money broadly beyond TIPS.
- Government policies making digital payments cheaper and more attractive, such as fee waivers on card POS transactions.
- Expansion of agent networks facilitating mobile money adoption nationwide.
The Bank of Tanzania is also relying on the upgraded Financial Services Registry, which incorporates geospatial mapping tools, to monitor the reach of financial services and address persistent access gaps in rural areas.
As of December 2024, Tanzania had more than 52,000 financial access points, with urban areas such as Dar es Salaam having a ratio of financial access points that exceeds 15 per 10,000 adults. However, the number of financial access points in rural districts of Tanzania is below the national average of 4.8 per 10,000 adults.
In conclusion, Tanzania’s digital payment ecosystem—anchored by the centrally operated TIPS—has rapidly expanded, enhancing interoperability and inclusion. However, Kenya’s mobile money market remains much larger by transaction volume and value, driven by a market-dominant, primarily private-sector model. Tanzania’s centrally coordinated approach aims to unify fragmented payment services from the start, creating a national infrastructure that supports diverse providers under one system.
[1] Central Bank of Kenya, Financial Access Indicators Report, 2024 [2] Bank of Tanzania, Tanzania Instant Payment System (TIPS) Annual Report, 2024 [3] Bank of Tanzania, Financial Stability Report, 2024 [4] Tanzania Communications Regulatory Authority, Mobile Money Report, 2024 [5] World Bank, Tanzania Digital Financial Services Landscape Report, 2024
- The growth in Tanzania's digital payment landscape, propelled by TIPS, has significantly impacted lifestyle by promoting financial inclusion, providing a convenient means of finance management using technology.
- The surge in real-time digital payment transactions from education-and-self-development activities, like remittances and tuition fees, can be attributed to the improved accessibility and interoperability of TIPS, thereby enhancing financial inclusion.
- General news outlets repeatedly cover the expansion of digital payments in Tanzania, discussing factors such as government policies, the role of TIPS, and rural access gaps, making it a topic of ongoing interest within the finance and technology sectors.
