01 — OverviewExecutive Summary
Tanzania's bank lending and deposit rates moved only modestly in July 2026 on average — but averages hide a more interesting story underneath. The overall shilling lending rate eased slightly to 14.85%, while the overall time deposit rate edged up to 8.78%, and the gap between the two widened to 6.20 percentage points, its widest point since at least January 2026. Underneath that headline, different loan tenors and deposit terms moved in noticeably different directions.
This briefing unpacks lending and deposit rates by tenor, in both shillings and foreign currency, using the Bank of Tanzania's own data for July 2026, set against a full thirteen-month trend from July 2025.
- The lending-deposit spread widened to 6.20 percentage points, up 54 basis points from June — the sharpest one-month widening in the series.
- Medium-term shilling loans (1-2 years) are the most expensive standard tenor at 16.24%, even after easing from a high of 17.19% in April 2026.
- Negotiated rates for prime borrowers rose to 12.04%, roughly 2.8 percentage points below the overall lending rate — a reminder of how much a borrower's negotiating position matters.
- Deposit rates are far from uniform: ordinary savings accounts pay just 2.90%, while 12-month fixed deposits pay more than triple that at 9.34%.
- Dollar borrowing remains markedly cheaper than shilling borrowing — 8.48% for foreign currency loans versus 14.85% for shilling loans, a gap of roughly 6.4 percentage points.
Read this alongside TICGL's Government Securities & Interbank Cash Market briefing
Lending and deposit rates do not move in isolation — they sit downstream of the same Central Bank Rate decision, Treasury yields, and interbank liquidity conditions covered in TICGL's companion briefing on July 2026's money and debt markets. Together, the two pieces give a fuller picture of the cost of shilling capital right now.
Read: Tanzania's Government Securities & Interbank Cash Market →02 — At a GlanceKey Numbers From July 2026
Overall Lending Rate vs. Overall Time Deposit Rate (Shilling)
Source: Bank of Tanzania, Table A4 — Interest Rates Structure, Monthly Economic Review, August 2026.
03 — MethodologyReading the Bank of Tanzania's Rate Data
The Bank of Tanzania publishes monthly average lending and deposit rates in two currencies: Tanzanian shillings and foreign currency (predominantly US dollars). Shilling rates are further broken down by loan tenor (short-term up to 1 year, medium-term 1-2 and 2-3 years, long-term 3-5 years, and term loans over 5 years) and by deposit term (savings, and fixed deposits from 1 to 24 months), alongside separate "negotiated" rates that reflect what banks' strongest, most creditworthy customers actually pay or earn.
Monthly rates for each lending tenor and each deposit term, in both shillings and foreign currency, were plotted from July 2025 through July 2026, drawn from Table A4 (Interest Rates Structure) and Table 2.3.1 (Lending and Deposit Interest Rates). The lending-deposit spread shown in Theme 1 follows the Bank of Tanzania's own definition: the short-term (up to 1 year) lending rate minus the 12-month deposit rate.
A single "overall lending rate" headline can mask very different realities for different borrowers: a term loan over 5 years, a working-capital facility under 1 year, and a negotiated rate for a large corporate client can differ by several percentage points in the same month. Breaking the averages apart by tenor is what actually informs a financing decision.
1. Lending vs. Deposit Rates: A Spread That Keeps Widening
Widest spread since January 2026The overall shilling lending rate eased to 14.85% in July 2026, from 15.22% in June, while the overall time deposit rate rose to 8.78%, from 8.69%. Read alone, that looks like good news for both sides. But the Bank of Tanzania's official spread metric — short-term lending (up to 1 year) minus the 12-month deposit rate — tells a different story: it widened to 6.20 percentage points, up 54 basis points from 5.66 in June, because the 12-month deposit rate fell faster (to 9.34% from 9.72%) than the short-term lending rate moved.
Lending–Deposit Spread, 13-Month Trend
| Rate | Jan-26 | Mar-26 | May-26 | Jun-26 | Jul-26 |
|---|---|---|---|---|---|
| Savings deposit rate | 2.94 | 2.89 | 2.85 | 2.90 | 2.90 |
| Overall time deposit rate | 8.33 | 8.33 | 8.43 | 8.69 | 8.78 |
| 12-month deposit rate | 9.70 | 9.60 | 10.17 | 9.72 | 9.34 |
| Negotiated deposit rate | 11.74 | 11.57 | 11.25 | 11.17 | 10.99 |
| Overall lending rate | 15.10 | 15.11 | 15.32 | 15.22 | 14.85 |
| Short-term lending (up to 1yr) | 15.49 | 15.45 | 15.38 | 15.38 | 15.54 |
| Negotiated lending rate | 12.25 | 12.21 | 11.90 | 11.93 | 12.04 |
| Lending–deposit spread | 5.79 | 5.85 | 5.22 | 5.66 | 6.20 |
Source: Bank of Tanzania, Table 2.3.1 — Lending and Deposit Interest Rates.
A widening spread driven by a falling deposit rate, rather than a rising lending rate, is a subtly different story for policy: it says less about credit risk pricing tightening and more about banks having ample liquidity to fund loans without needing to compete as hard for term deposits — consistent with the ample interbank liquidity TICGL documented in its companion briefing this month.
2. Lending Rates by Tenor: Medium-Term Money Costs Most
Non-linear across the curveShilling lending rates do not rise smoothly with tenor the way government bond yields do. In July 2026, medium-term loans of 1-2 years were the most expensive standard tenor at 16.24%, more expensive than both shorter loans (15.54% for up to 1 year) and longer ones (13.79% for 3-5 years) — a shape that has held broadly true across the past year.
Shilling Lending Rate by Tenor, 13-Month Trend
| Tenor | Jan-26 | Mar-26 | May-26 | Jun-26 | Jul-26 | 12-mo change |
|---|---|---|---|---|---|---|
| Short-term (up to 1 year) | 15.49 | 15.45 | 15.38 | 15.38 | 15.54 | +0.03 pp |
| Medium-term (1-2 years) | 16.73 | 16.53 | 17.11 | 17.10 | 16.24 | -0.17 pp |
| Medium-term (2-3 years) | 14.97 | 15.31 | 15.60 | 15.19 | 14.81 | -0.41 pp |
| Long-term (3-5 years) | 14.05 | 13.95 | 14.43 | 14.38 | 13.79 | -0.60 pp |
| Term loans (over 5 years) | 14.24 | 14.30 | 14.08 | 14.03 | 13.88 | -0.40 pp |
| Overall lending rate | 15.10 | 15.11 | 15.32 | 15.22 | 14.85 | -0.31 pp |
| Negotiated lending rate | 12.25 | 12.21 | 11.90 | 11.93 | 12.04 | -0.52 pp |
Source: Bank of Tanzania, Table A4 — Interest Rates Structure. 12-month change measured against July 2025.
Overall vs. Negotiated Lending Rate
The consistent ~2.5-3 percentage point gap between the overall and negotiated lending rate is a useful negotiating benchmark: it is roughly what a well-collateralised, low-risk borrower with strong bargaining power can expect to save relative to the average posted rate.
3. Deposit Rates by Tenor: Savers Are Rewarded for Locking In
Clear premium for longer termsUnlike lending rates, deposit rates in Tanzania rise fairly consistently with the length of time a saver commits their money. Ordinary savings accounts — instant-access, no fixed term — paid just 2.90% in July 2026, while a 12-month fixed deposit paid more than three times as much, at 9.34%.
Shilling Deposit Rate by Term, 13-Month Trend
Overall vs. Negotiated Deposit Rate
Negotiated deposit rates — available to large or strategically important depositors — have consistently outpaced even the 12-month standard rate, at 10.99% in July 2026. For treasury managers with flexibility over placement size and tenor, that gap is worth actively negotiating rather than accepting posted rates.
4. Foreign Currency Lending & Deposit Rates
Cheaper, but with FX risk attachedForeign currency (largely US dollar) lending and deposit rates sit on their own, structurally lower curve. The overall FX lending rate was 8.48% in July 2026, down from 9.03% in June, while the overall FX deposit rate was 4.11%, down from 4.30%.
FX Overall Lending vs. FX Overall Deposit Rate
FX Lending Rate by Tenor
| Rate | Jan-26 | Mar-26 | May-26 | Jun-26 | Jul-26 |
|---|---|---|---|---|---|
| Savings deposit rate (FX) | 0.77 | 1.22 | 1.06 | 1.64 | 1.65 |
| Overall time deposit rate (FX) | 4.18 | 4.26 | 4.47 | 4.30 | 4.11 |
| 12-month deposit rate (FX) | 3.82 | 4.35 | 5.59 | 4.57 | 4.65 |
| Overall lending rate (FX) | 8.57 | 8.70 | 8.72 | 9.03 | 8.48 |
| Short-term lending, up to 1yr (FX) | 10.00 | 10.00 | 9.95 | 9.99 | 10.02 |
| Long-term lending, 3-5yrs (FX) | 8.64 | 9.09 | 9.08 | 9.09 | 7.96 |
Source: Bank of Tanzania, Table A4 — Interest Rates Structure, Foreign Currency section.
5. Shilling vs. Dollar: The Cost of Credit, Side by Side
A persistent ~6-point gapPlaced side by side, the gap between shilling and dollar borrowing costs in Tanzania is large and persistent — not a one-month anomaly. Shilling lending has cost roughly double what dollar lending costs throughout the past thirteen months.
Domestic (Shilling) vs. Foreign Currency Overall Lending Rate
Lending–Deposit Spread: Shilling vs. Foreign Currency
The persistent gap between shilling and dollar lending costs is a major reason many Tanzanian corporates with foreign currency revenue seek dollar-denominated facilities where possible — but that choice trades a lower interest rate for exposure to shilling depreciation risk, which TICGL's companion briefing shows has been mild but not negligible over the past year.
06 — SynthesisCross-Cutting Synthesis: The Month in One Picture
Both the overall lending rate and the negotiated lending rate moved in favourable directions for borrowers on the surface, yet the official spread metric still widened — because deposit rates fell faster at the 12-month tenor specifically.
A borrower quoted "the overall lending rate" could be paying anywhere from 13.79% (long-term) to 16.24% (medium-term 1-2 years) depending on facility structure — a spread of nearly 2.5 percentage points hidden inside one average.
Prime borrowers and large depositors both access rates roughly 2.5-3 percentage points more favourable than the posted average — a gap worth actively pursuing in any sizeable facility or placement.
The persistent ~6 percentage point gap between shilling and dollar lending costs makes currency denomination one of the single largest cost variables available to borrowers with foreign currency revenue.
07 — ApplicationWho This Matters To
Corporate & SME Borrowers
- Compare facility structures across tenor before assuming the "overall lending rate" applies — medium-term 1-2 year loans carry the highest average cost.
- Where foreign currency revenue exists, weigh the ~6-point rate saving on dollar loans against shilling depreciation risk.
Savers & Corporate Treasurers
- Ordinary savings accounts pay a fraction of what 12-month fixed deposits or negotiated placements offer — idle balances are a real opportunity cost.
- Negotiated deposit rates (10.99% in July) are consistently above even the 12-month standard rate for depositors with placement flexibility.
Banks & Credit Committees
- The widening spread driven by falling 12-month deposit rates, rather than rising lending rates, points to ample funding liquidity rather than tightening credit conditions.
- Track the overall-to-negotiated rate gap as a proxy for competitive pressure on pricing for top-tier clients.
PPP Structurers & Development Finance
- Use tenor-specific rates, not the overall average, when modelling shilling debt service costs for long-dated infrastructure financing.
- Factor the shilling-dollar rate gap into currency-of-denomination decisions for blended or co-financed structures.
"An 'average lending rate' is a useful headline and a poor financing plan. The same month that saw the overall rate ease to 14.85%, a two-year shilling facility still cost over 16% — the difference between those two numbers is where the real financing decision happens."
— TICGL Directorate of Economic Research and Policy
08 — Sources & Data NotesReferences, Data Sources and Limitations
TICGL Directorate of Economic Research and Policy analysis of the Bank of Tanzania's Monthly Economic Review, August 2026 edition (data through July 2026) — specifically Table 2.3.1 (Lending and Deposit Interest Rates) and Table A4 (Interest Rates Structure, domestic and foreign currency sections).
- Primary data: Bank of Tanzania, Monthly Economic Review, August 2026, covering data through July 2026.
- Method: Monthly shilling and foreign currency lending rates by tenor, and deposit rates by term, compiled into thirteen-month trend series (July 2025–July 2026). The lending-deposit spread follows the Bank of Tanzania's definition: short-term (up to 1 year) lending rate minus the 12-month deposit rate.
- Known limitations: Rates published by the Bank of Tanzania are bank-average figures and do not capture the full range of pricing an individual borrower or depositor may be offered based on collateral, credit history, or relationship strength. Figures for July 2026 are the most recent available and may be revised in subsequent monthly reviews.
- Related TICGL analysis: "Tanzania's Government Securities & Interbank Cash Market: What July 2026 Reveals" — read here.
09 — Quick AnswersFrequently Asked Questions
What is Tanzania's overall bank lending rate in July 2026?
Tanzania's overall shilling lending rate stood at 14.85% in July 2026, easing from 15.22% in June 2026, according to the Bank of Tanzania. Negotiated rates for prime borrowers rose to 12.04% over the same period.
What interest rate do Tanzanian banks pay on deposits?
The overall shilling time deposit rate was 8.78% in July 2026, up from 8.69% in June. The savings deposit rate, which applies to ordinary savings accounts, was far lower at 2.90%, while the 12-month deposit rate stood at 9.34%.
Why is there a gap between lending and deposit rates in Tanzania?
The spread between short-term lending rates and 12-month deposit rates widened to 6.20 percentage points in July 2026, from 5.66 in June — a 54 basis point increase. This spread reflects banks' operating costs, credit risk pricing, and profit margins, and it typically widens when lending rates rise faster than deposit rates, or when deposit rates fall while lending rates hold firm.
Are US dollar loan interest rates cheaper than shilling loan rates in Tanzania?
Yes. The overall foreign currency (largely US dollar) lending rate was 8.48% in July 2026, compared to 14.85% for shilling lending — a gap of about 6.4 percentage points. Foreign currency deposit rates were also lower, at 4.11% overall versus 8.78% for shilling deposits.
Which loan tenor is most expensive for shilling borrowers in Tanzania?
Medium-term shilling loans of 1-2 years carried the highest rate among standard tenors at 16.24% in July 2026, ahead of short-term loans (up to 1 year) at 15.54%, while long-term loans of 3-5 years were comparatively cheaper at 13.79%.
Muhtasari kwa Kiswahili
Riba za Mikopo na Amana Tanzania, Julai 2026 — Riba ya jumla ya mikopo ya shilingi ilishuka kidogo hadi asilimia 14.85 mwezi Julai 2026, kutoka asilimia 15.22 Juni, huku riba ya jumla ya amana za muda ikiongezeka hadi asilimia 8.78 kutoka asilimia 8.69. Hata hivyo, tofauti (spread) baina ya riba ya mkopo na amana iliongezeka hadi pointi asilimia 6.20, kutoka 5.66 mwezi Juni — ongezeko kubwa zaidi la mwezi mmoja katika kipindi hiki.
Matokeo makuu: Mikopo ya muda wa kati (miaka 1-2) ndiyo ghali zaidi kwa asilimia 16.24, ikizidi hata mikopo ya muda mfupi (chini ya mwaka 1) yenye asilimia 15.54. Riba zinazojadiliwa (negotiated) kwa wakopaji wenye nguvu ya majadiliano ni chini kwa takribani pointi 2.5-3 kuliko wastani wa jumla. Akaunti za akiba za kawaida zinalipa asilimia 2.90 tu, wakati amana za muda wa miezi 12 zinalipa zaidi ya mara tatu ya hilo, asilimia 9.34. Mikopo ya dola bado ni nafuu zaidi kuliko ya shilingi — asilimia 8.48 dhidi ya asilimia 14.85 — tofauti ya pointi za asilimia 6.4.
Hitimisho kuu ni kwamba "riba ya jumla" pekee haitoshi kufanya maamuzi ya kifedha — muda wa mkopo (tenor), sarafu, na uwezo wa majadiliano wa mteja vyote vinabadilisha gharama halisi ya fedha kwa kiasi kikubwa.
- Riba ya jumla ya mkopo (shilingi): asilimia 14.85 (Julai 2026)
- Riba ya jumla ya amana: asilimia 8.78 (Julai 2026)
- Tofauti ya riba ya mkopo na amana: pointi asilimia 6.20
- Riba ya mkopo wa dola: asilimia 8.48 dhidi ya shilingi asilimia 14.85
Chanzo: Benki Kuu ya Tanzania, Monthly Economic Review, Agosti 2026. Uchambuzi: TICGL Directorate of Economic Research and Policy.