The Bank of Tanzania

History of the Bank of Tanzania

1.      Monetary Arrangements in Tanzania Prior to the Establishment of the Bank of Tanzania

In this Section, a brief account will be presented on the monetary arrangements in Tanzania prior to the establishment of the Bank of Tanzania. For that purpose, two periods will be distinguished:

1. the period before the establishment in December 1919 of the East African Currency Board (EACB) and
2. the period until the opening of the Bank of Tanzania in June 1966.

Monetary arrangements in Tanzania prior to l919 were different on the Mainland from those for Zanzibar, since the former was under German rule, while the latter had its own government. The currency on the Mainland was the German Rupee, made of silver, while the subsidiary coin was the Heller, which was 1/100 of the Rupee. In Zanzibar, the Indian Silver Rupee and its subsidiary coins were in circulation. In addition, shells and cattle used to serve as a store of value, and, to a certain extent, even as a medium of exchange. Commercial banking was introduced in the country in 1905, when the Deutsch-Ostafrikanische Bank opened its office in Dar es Salaam. This bank had a concession from the German Government to issue its own notes and coins, which helped the bank to meet the demand for coins in exchange for its notes. A temporary mint was set up in Tabora. In 1911, another German bank, namely the Handelsbank fuer Ostafrika, opened a branch in Tanga. There also was an official savings bank.

After World War I, the Mainland became a mandate territory of the United Kingdom (UK) and its monetary system was aligned to that of Kenya and Uganda, mainly in two aspects:

1. through the establishment of the EACB in December 1919 and
2. by auctioning off the assets of the German banks and permitting British banks to open their offices.

State. Board currency was essentially issued in exchange for pound sterling, indicating that the EACB’s currency was backed predominantly by pound sterling.

2.      The Establishment of the Bank of Tanzania

Following the decision to dissolve the EACB and to establish separate Central Banks in Tanzania, Kenya, and Uganda, the Bank of Tanzania Act, 1965, was passed by the National Assembly in December 1965, and the Bank was opened by the first President of Tanzania Mwalimu Julius K. Nyerere on June 14, 1966.

During the same period, several other developments occurred, e.g., a radical transformation of the rural economy, as a result of the villagisation programme, industrialisation, and persistent weaknesses in the Balance of Payments. In order to enable the Bank to better address these developments, the Bank of Tanzania Act was amended in 1978, developmental functions were vested in the Bank. As stipulated in this amendment, the Bank established four special Funds:

1. the Rural Finance Fund;
2. the Industrial Finance Fund;
3. the Export Credit Guarantee Fund; and
4. the Capital and Interest Subsidy Fund.

Bank of Tanzania Location

From the map of Africa you can easily find  East African Countries,  United Republic of  Tanzania being among them. Bank of Tanzania Headquarters  are  situated at Dar-es- Salaam city center. Bank of Tanzania postal address is shown below.

Postal Address
Bank of Tanzania
P.O. Box 2939
Dar es Salaam
Tanzania

Street Address
2 MIRAMBO STREET
11884 DAR ES SALAAM
TANZANIA