Cross-border mobile money flows grew by 33 per cent to Sh698 billion

BoT Governor, Emmanuel Tuduba attributed the growth to the continued expansion of the country’s digital payments environment, driven by new market entrants, product innovation and a supportive regulatory environment.

“The payments ecosystem has continued to expand with the entry of new participants and innovative products, supported by a favorable regulatory and operating environment,” he said.

Mr Dutuba noted that the central bank has strengthened supervision through improved monitoring systems, enhanced risk management frameworks and closer engagement with industry players to safeguard financial system stability.

He said Tanzania was working closely with EAC and SADC member states to harmonize regulatory frameworks and deepen regional integration of payment systems.

While incoming transactions registered strong growth, outgoing payments presented a mixed picture. The volume of external transactions increased by 13.77 per cent to 2.52 million, but their value declined by 19.17 per cent to Sh275.19 billion from Sh340.45 billion in 2024, indicating a decline in average transaction volumes.

As mobile money is increasingly used for high-frequency, low-value cross-border payments, informal trade settlements and remittances, the widening gap between inflows and outflows points to changing usage patterns.

“This trend reflects the importance of mobile payments in facilitating cross-border payments within the EAC and SADC regions,” the central bank said in its National Payment Systems Annual Report 2025.

The development comes as Tanzania steps up efforts to modernize its payment infrastructure and aligns with the G20 roadmap aimed at making cross-border payments faster, cheaper, transparent and accessible.

The roadmap seeks to address long-standing challenges that have made international money transfers expensive and slow, especially for individuals and small businesses.

Under the framework, countries aim to reduce the average cost of cross-border remittances by one to three percent by 2027, while ensuring that at least 75 percent of transactions are credited within one hour and that fee structures and foreign exchange rates are more transparent.

While Tanzania has made progress in expanding its digital payment infrastructure, the report notes that improvements for end-users remain uneven, highlighting the need for further reforms to meet the 2027 targets.

The Bank for International Settlements (BIS) has identified harmonized data standards, robust interoperability and broad access models as key enablers of more efficient cross-border payment systems.

To accelerate progress, Tanzania has stepped up cooperation with regional partners through the EAC Cross-Border Payment System Masterplan 2025, which aims to reduce transaction costs, improve settlements in local currencies and improve real-time interoperability among member states.

The BoT continues to strengthen cross-border payment capacity through the Tanzania Instant Payment System (TIPS).

TIPS complements regional payment platforms such as the East African Payments System (EAPS) and the SADC Real-Time Gross Settlement (SADC-RTGS) system, both of which facilitate cross-border transactions between participating countries.

Additionally, Tanzania is gradually adopting the Pan-African Payment and Settlement System (PAPSS), a continental platform designed to support intra-African trade by enabling transactions in local currencies.

The system is expected to reduce reliance on offshore correspondent banking arrangements, which often increase transaction costs and settlement times.

The expansion of cross-border mobile money services is a key driver of regional trade, labor mobility, particularly in the EAC.