NMB 1.1TRN/- FINANCING EMPOWERS OVER 600 LOCAL CONTRACTORS IN TWO YEARS

NMB Bank unveiled a package of enhanced financing solutions aimed at empowering local contractors and fostering the growth of the construction industry, thereby boosting the national economy.

The NMB funding services improvements were announced during a networking session with contractors, where the Bank’s Chief of Retail Banking, Filbert Mponzi revealed that over the past two years, the bank has disbursed TZS 1.1 trillion in loans to the construction industry and its entire value chain

Mr. Mponzi noted that since 2022, this investment has supported over 600 contractors who continue to face working capital challenges in executing projects and competing effectively for construction tenders.

“To ensure we expand the scope of our services in addressing the financial challenges faced by local contractors during undertaking of projects, the financing improvements we have made include increase in the value of bid bond guarantees as well as performance and advanced payment guarantees,” he said.

The lender has increased its bid bond guarantee for local contractors to TZS 5 billion without collateral, up from the previous level of TZS 2.5 billion. Additionally, unsecured performance and advance payment guarantees have been raised to TZS 3 billion, from the previous limit of TZS 1.5 billion.

Mr. Mponzi explained that the guarantees will not only be timely but also come with lenient conditions.

He emphasized that these financial service improvements, which have also expanded the scope of public works financed by NMB Bank, are specifically for contractors engaged in projects with government and public institutions in both Mainland Tanzania and Zanzibar.

According to him, these novel enhancements are the direct result of the bank's research into the financing challenges local contractors face, particularly their struggle to keep pace with the rapidly growing construction sector driven by a strong national economy.

He said NMB is confident that the new funding initiative will significantly enhance the financial capacity of local contractors, bolstering their capital bases and enabling them to compete effectively in bidding for major project tenders.

“We strongly believe these new solutions are a major milestone for our local contractors and reaffirm NMB Bank’s commitment to supporting the government’s efforts in advancing the construction industry and boosting its contribution to the national economy,” Mr Mponzi told Works Deputy Minister Godfrey Kasekenya, who officiated the debut of the enhanced financial solutions.

He explained that, in addition to providing loans, NMB also collaborates closely with contractors in various economic and social spheres through their professional associations and regulatory bodies, including CRB, TUCASA, and TWCA.

Commending the bank for supporting the construction industry, Eng. Kasekenya said the endeavour aligns with the aspirations and directives of President Dr. Samia Suluhu Hassan to financially empower local contractors, enabling them to grow, compete effectively, and contribute meaningfully to national building efforts.

He noted that the scope of works locals can bid on has now been expanded from TZS 10 billion to TZS 50 billion, highlighting that funding and working capital are among the major challenges contractors face.

Additionally, he pointed out the lack of technologically advanced heavy equipment required for modern and mega projects, as well as the need for professional management of these undertakings.

“The construction industry is a key pillar of the national economy and a major employer, currently beleaguered by myriad challenges such as lack of adequate financing and limited capital sources. NMB's improved funding solutions are set to address these issues,” he noted in a speech he read on behalf of Works Minister Innocent Bashungwa.

The Zonal Manager of the Contractors Registration Board, Eng. Ally Mwita, urged local contractors to fully exploit the NMB financing solutions, which he described as a win-win opportunity for the two strategic national development stakeholders.