Financial inclusion in Tanzania: A justification for the shrinking of the gap among the rural dwellers

In 2023, the FSDT released the key findings of the FinScope Tanzania 2023 Survey. The report compares changes in financial inclusion between 2017 and 2023, and concludes that, overall, the rural–urban financial divide has decreased. However, it remains unclear why and how financial inclusion of rural dwellers would have improved, and why the environment within the country has become more favorable for financial inclusion. Therefore, this study analyses whether and how affirmative actions in Tanzania between 2017 and 2023 contributed to any type of financial inclusion improvement. The study takes changes in financial systems, financial agents, and financial literacy as its theoretical and analytical starting point. These three areas of change are then used as prompts to review government policy documents and associated development literature covering the period from 2017 to 2023, and to address aspects of financial inclusion in Tanzania. The review yielded that Tanzania developed new financial policies, Acts and regulations which has generated novel financial products and services. From these findings, we conclude that changes in financial systems, changes in financial agents, and changes in financial literacy have given Tanzania increased levels of financial inclusion, both in urban and rural areas. Further studies should thus focus on tapping the potential of the banking sector in Tanzania. The study recommends conducting additional research on how policies can influence rural dwellers into financial inclusion through banking. This could accelerate the pace of financial inclusion in rural Tanzania.