Of recent times, microfinance has demonstrably become the most coveted solution to building a robust and efficient national economy that is inclusive of the low-income segment in both urban and rural areas. The historically nascent level of microfinance services in Tanzania has prompted various non-government organization (domestic and foreign) and financial institutions to take up active roles in providing this service. Institutions such as the Foundation for International Community Assistance (FINCA), SEDA, PRIDE and Bangladesh Rural Advancement Committee (BRAC) are some of the active players to have taken up this role in the microfinance subsector. Meanwhile, larger financial institutions have also ventured into carrying out microfinance operations. Banks such as NMB and CRDB which was established in 1995 as a hybrid of a commercial and microfinance bank are key examples of this. The exciting evolution ofmicrofinance can be traced from before 2000. Before 2000 The microfinance movement, which is a rightfully autonomous movement albeit closely linked to the farmers’ cooperatives, experienced mixed fortunes because of changes in government policy.Cooperatives had firstly been promoted as a model and were then replaced by the Ujamaa village. Since that time these cooperatives have not regained the status they enjoyed in the years of
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