Chairman Message

Dear Esteemed Members,

Since its modest beginnings in 2008, Islamic finance in Tanzania has grown into a dynamic, resilient, and rapidly expanding industry. The year 2025 has been particularly significant, highlighted by the issuance of the Banking and Financial (Non-Interest Banking Business) Regulations, 2025 by the Government through the Bank of Tanzania, marking a major milestone in advancing Shariah-compliant financial services nationwide. The achievements of the year reflect the growing trust and confidence that individuals, institutions, and regulators place in Islamic Finance as a viable, ethical, and inclusive financial alternative.

Our Islamic Finance ecosystem continued to grow, even though the number of institutions has remained relatively stable. It comprises five (5) key banks providing Islamic Financial Services, anchored by Amana Bank, Tanzania’s only fully-fledged Islamic bank, and complemented by several robust Islamic banking windows, including, PBZ Ikhlas, KCB Sahl, CRDB Al Barakah, and NBC La Riba. This growth is reflected not only in an expanding client base but also in the diversification and size of their financial portfolios. Other notable developments include Takaful (Islamic insurance), Islamic mutual funds, and multiple issuances of Islamic Bonds (Sukuks), which have all achieved significant milestones this year as indicated in their respective reports. Collectively, these advancements demonstrate that Islamic Finance in Tanzania is increasingly recognized not merely as a niche offering, but as a strategic, ethical, and sustainable framework for economic participation and wealth creation.

The global Islamic Finance industry continued its robust growth trajectory, with assets expanding by 21% in 2024 to reach US$6.0 trillion and projected to exceed US$9.7 trillion by 20291. This global performance has been driven by:

Robust Sukuk issuances across sovereign and corporate sectors
Expanded adoption of Islamic fintech and digital platforms
Increased investor interest in ethical, ESG-aligned, and faith-based instruments
Strong regulatory support within leading markets such as Malaysia, Saudi Arabia, the UAE, Indonesia, and Pakistan

Africa’s participation in this global momentum continues to strengthen, with Tanzania emerging as a frontier market in East African countries. Our commitment to nurturing a compliant, transparent, and well-governed Islamic finance ecosystem positions us favorably within the global Islamic economy.

Challenges

While the gains of 2025 are notable, we remain conscious of the challenges the industry must continue to address:

Effective implementation of the Banking and Financial Institutions (Non-Banking Financial Institutions) Regulations,
Limited public awareness and understanding of Islamic finance products and services
Low and inconsistent membership contributions from industry stakeholders
Low progress in Islamic Microfinance and Takaful penetration
A persistent shortage of qualified Islamic Finance professionals
Limited outreach in rural and underserved areas

These challenges remind us that meaningful growth requires continuous effort, policy support, and coordinated action from all stakeholders.