TANZANIA TABLES MOVABLE ASSETS SECURED LENDING BILL 2026 IN PARLIAMENT TO EXPAND ACCESS TO CREDIT

The Minister for Finance, Hon. Ambassador Khamis Mussa Omar (MP), presenting to Parliament the Movable Assets Secured Lending Bill, 2026, which seeks to establish an effective framework for managing loans provided against movable assets as collateral.

DODOMA - August 31, 2026: Minister for Finance, Hon. Ambassador Khamis Mussa Omar (MP), has tabled the Movable Assets Secured Lending Bill, 2026 in Parliament, seeking to establish a comprehensive framework for the management of loans secured by movable assets.

Presenting the Bill in Parliament in Dodoma, Hon. Ambassador Omar said the proposed legislation is aimed at increasing the use of banking services in Tanzania from 22 percent in 2023 to 50 percent by 2030.

He said the Bill also seeks to increase private sector credit as a proportion of Gross Domestic Product (GDP) from 22.5 percent in 2024 to 50 percent by 2030, while supporting job creation and increasing the contribution of the financial sector to 20 percent by 2030, from 17.1 percent in 2024.

According to the Minister, the proposed legislation is important in expanding access to credit for individuals and businesses by allowing them to use movable assets as collateral, rather than relying predominantly on immovable assets such as land and buildings.

ADDRESSING CHALLENGES IN MOVABLE ASSET COLLATERAL

Hon. Ambassador Omar said one of the key challenges the Bill seeks to address is the absence of a unified registration system for movable assets that can be used as collateral.

The lack of such a system has created a situation where the same asset can potentially be used as collateral for multiple loans without other lenders being aware of existing claims over the asset. This could contribute to an increase in non-performing loans within the financial sector.

Other challenges include the absence of a coordinated system for managing movable assets used as collateral, as well as inadequate procedures for enforcing the rights of borrowers and lenders when such assets are sold.

The Minister also highlighted the importance of establishing an appropriate framework because some movable assets can lose their value within a short period of time or may be subject to damage or deterioration.

BILL DIVIDED INTO TEN PARTS

Hon. Ambassador Omar said the Bill is divided into ten parts, establishing a comprehensive legal framework governing the use, registration, management and enforcement of security interests in movable assets.

PART ONE: PRELIMINARY PROVISIONS

Part One contains preliminary provisions, including the title of the proposed law, its commencement, application and interpretation of key terms used in the legislation.

PART TWO: ROLE OF THE BANK OF TANZANIA

Part Two establishes provisions within the Bank of Tanzania relating to security interests and sets out the powers of the Bank, including the delegation of its responsibilities.

PART THREE: SECURITY INTERESTS

Part Three provides for security interests securing one or more obligations and identifies the types of assets that may be used as collateral.

These include tangible and intangible assets, as well as movable and immovable assets.

The Part also requires the Bank of Tanzania to consult the Minister before declaring assets that may be used as collateral.

PART FOUR: REGISTRATION OF SECURITY INTERESTS

Part Four addresses the registration of security interests, including the validity period of registrations, amendments and cancellations, as well as procedures for searching registered information.

PART FIVE: SECURITY INTERESTS AGAINST THIRD PARTIES

Part Five covers security interests against third parties, interests in proceeds arising from collateral and the enforcement of security interests in movable assets that have been combined or mixed with other assets.

PART SIX: PRIORITY OF SECURITY INTERESTS

Part Six establishes rules governing the priority of competing security interests, proceeds and payments that have been commingled, as well as the impact of insolvency on a borrower.

It sets out the rights of different parties in relation to collateral and establishes rules governing priority among competing security interests.

PART SEVEN: RIGHTS AND OBLIGATIONS OF PARTIES

Part Seven provides for the right to inspect collateral, obligations to provide information and the responsibility to preserve collateral.

It also sets out the rights and obligations of debtors, including claims relating to payments made by debtors, rights to expected collections, and assets or payment instruments that facilitate payment or enforcement of security interests.

The Part also provides for the protection of borrowers' rights.

PART EIGHT: ENFORCEMENT OF SECURITY INTERESTS

Part Eight establishes provisions governing the enforcement of security interests, including registration of enforcement notices, removal of collateral and the use of collateral to satisfy obligations arising from a loan.

It also sets out procedures for the disposal of collateral and provides for the limitation of security interests following disposal.

The Part further addresses the distribution of proceeds, proposals for taking ownership of collateral in satisfaction of a debt and procedures for objecting to such proposals.

In addition, it provides for the preservation and storage of collateral, storage costs and the borrower's right to choose an alternative place for storing the collateral.

PART NINE: GENERAL PROVISIONS

Part Nine contains general provisions covering the enforcement of rights and obligations, the right to seek compensation for breaches of obligations, immunity, offences relating to the provision of false information, complaints and reviews of decisions made by the Bank, as well as appeals.

The Part also gives the Minister powers to make regulations necessary to facilitate the effective implementation of the proposed law.

PART TEN: CONSEQUENTIAL AMENDMENTS

Part Ten provides for amendments to various laws, including the Bank of Tanzania Act, Companies Act, Insolvency Act and other legislation relating to the management of assets and financial matters.

The proposed amendments are intended to facilitate the effective implementation of the new legal framework.

EXPANDING ACCESS TO CREDIT

Hon. Ambassador Omar said enactment of the proposed legislation would help create a more conducive environment for access to credit, strengthen the management of collateral, protect the rights of both borrowers and lenders, and promote the development of Tanzania's financial sector.

The proposed framework is therefore expected to broaden the range of assets that individuals and businesses can use to secure financing, potentially making formal credit more accessible to a wider segment of the population and supporting the country's financial inclusion and economic growth objectives.

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