Executive Summary
Tanzania's bank interest rate structure held broadly stable through May 2026, with modest declines across both lending and deposit rates. The overall lending rate was little changed at 15.32 percent (from 15.33% in April), while the negotiated rate for prime customers eased more sharply to 11.90 percent from 12.56 percent — a signal that banks are competing harder for their best borrowers even as headline pricing stays flat. On the deposit side, the overall time deposit rate eased to 8.43 percent from 8.54 percent, while the negotiated deposit rate moderated to 11.25 percent. The resulting short-term interest rate spread narrowed to 5.22 percentage points, from 5.50 points in April 2026 — the tightest spread recorded since at least March 2025, pointing to gradually improving intermediation efficiency in the banking sector.
- Lending rates: Short-term lending (up to 1 year) eased to 15.38% while medium-term (1–2 year) lending actually rose to 17.11% from 17.19% — the highest tenor on the curve — reflecting banks pricing in duration risk more aggressively than short-dated risk.
- Deposit rates: The 12-month deposit rate rose to a 15-month high of 10.17%, even as the overall (blended) time deposit rate fell — suggesting banks are paying up more selectively for longer-dated, stickier deposits while short-tenor deposit pricing eased.
- Spread compression: The lending-deposit spread has now narrowed for two consecutive months (5.85 → 5.50 → 5.22 percentage points since March 2026), consistent with the Bank of Tanzania's accommodative liquidity stance feeding through to cheaper credit intermediation.
- Negotiated vs. posted rates: The gap between the overall lending rate (15.32%) and the negotiated lending rate (11.90%) has widened to 3.42 percentage points — the largest gap in the 15-month series — underscoring how much more competitively banks price loans for their strongest corporate and prime clients versus posted/list rates.
What's Next for Tanzania's Economy? The Policy Gaps Keeping $1 Trillion Out of Reach by 2050
Before diving into the interest rate data below, read TICGL's flagship analysis on the structural and policy gaps standing between Tanzania and its Vision 2050 ambitions — essential context for interpreting the cost of credit and bank intermediation trends discussed here.
Read the Full Analysis →1. Lending Interest Rates by Tenor
Tanzania's overall lending rate stood at 15.32 percent in May 2026, essentially flat month-on-month. Beneath that headline figure, however, the lending curve by tenor tells a more nuanced story: short-term lending (up to 1 year) eased to 15.38%, medium-term (1–2 year) lending climbed to a series-high 17.11%, medium-term (2–3 year) lending eased slightly to 15.60%, long-term (3–5 year) lending fell to 14.43%, and term loans over 5 years eased to 14.08%. This "hump" in the middle of the curve — where 1–2 year money is priced above both shorter and longer tenors — suggests banks see the greatest duration/credit risk in that medium horizon.
Chart 1: Tanzania Lending Rates by Tenor (%) — March 2025 to May 2026
| Tenor | May-25 | Sep-25 | Jan-26 | Mar-26 | Apr-26 | May-26 |
|---|---|---|---|---|---|---|
| Short-term (up to 1 year) | 15.96 | 15.52 | 15.49 | 15.45 | 15.31 | 15.38 |
| Medium-term (1–2 years) | 16.35 | 16.26 | 16.73 | 16.53 | 17.19 | 17.11 |
| Medium-term (2–3 years) | 15.24 | 15.19 | 14.97 | 15.31 | 15.63 | 15.60 |
| Long-term (3–5 years) | 14.19 | 14.26 | 14.05 | 13.95 | 14.56 | 14.43 |
| Term loans (over 5 years) | 14.17 | 14.66 | 14.24 | 14.30 | 13.96 | 14.08 |
| Overall lending rate | 15.18 | 15.18 | 15.10 | 15.11 | 15.33 | 15.32 |
2. Deposit Interest Rates by Tenor
The overall time deposit rate eased to 8.43 percent in May 2026 from 8.54 percent in April. Within the deposit ladder, shorter tenors softened — the 1-month rate fell to 8.34% and the 3-month rate rose to 10.52% (its highest point in the 15-month series) — while the 12-month rate climbed to 10.17%, its highest level since at least March 2025. The savings deposit rate, which anchors the bottom of the curve, eased to 2.85%.
Chart 2: Tanzania Deposit Rates by Tenor (%) — March 2025 to May 2026
| Tenor | May-25 | Sep-25 | Jan-26 | Mar-26 | Apr-26 | May-26 |
|---|---|---|---|---|---|---|
| Savings deposit rate | 2.52 | 2.92 | 2.94 | 2.89 | 2.91 | 2.85 |
| 1-month deposit | 10.47 | 9.65 | 8.96 | 8.65 | 9.06 | 8.34 |
| 2-month deposit | 9.25 | 9.28 | 9.56 | 9.34 | 9.67 | 8.65 |
| 3-month deposit | 9.85 | 9.61 | 9.43 | 9.56 | 9.01 | 10.52 |
| 6-month deposit | 9.82 | 10.12 | 10.20 | 10.51 | 10.35 | 9.87 |
| 12-month deposit | 9.72 | 9.84 | 9.70 | 9.60 | 9.81 | 10.17 |
| 24-month deposit | 7.49 | 7.63 | 7.11 | 7.03 | 8.20 | 7.69 |
| Overall time deposit rate | 8.58 | 8.50 | 8.33 | 8.33 | 8.54 | 8.43 |
3. Interest Rate Spread Analysis
The short-term interest rate spread — defined by the Bank of Tanzania as the short-term (up to 1 year) lending rate less the 12-month deposit rate — narrowed to 5.22 percentage points in May 2026, from 5.50 points in April and 5.85 points in March. This is the narrowest spread recorded in the current data series, and reflects both softer short-term lending pricing and a simultaneously higher 12-month deposit rate.
Chart 3: Overall Lending vs. Overall Deposit Rate, and Spread (Percentage Points) — March 2025 to May 2026
| Indicator | Dec-25 | Jan-26 | Feb-26 | Mar-26 | Apr-26 | May-26 |
|---|---|---|---|---|---|---|
| Short-term lending rate (up to 1 year) | 15.46 | 15.49 | 15.41 | 15.45 | 15.31 | 15.38 |
| 12-month deposit rate | 9.58 | 9.70 | 9.82 | 9.60 | 9.81 | 10.17 |
| Short-term interest spread | 5.88 | 5.79 | 5.59 | 5.85 | 5.50 | 5.22 |
4. Negotiated Rates: Prime Client Pricing
Negotiated rates — the pricing banks offer their strongest, highest-volume clients — moved in opposite directions from posted rates in May 2026. The negotiated lending rate fell sharply to 11.90 percent from 12.56 percent in April, its lowest level in the 15-month series, while the negotiated deposit rate eased to 11.25 percent from 11.37 percent. The gap between the overall (posted) lending rate and the negotiated lending rate has widened to 3.42 percentage points, the widest gap recorded since March 2025 — evidence of intensifying competition among banks for prime corporate borrowers even as list pricing for the broader market stays essentially flat.
Chart 4: Negotiated Lending Rate vs. Negotiated Deposit Rate (%) — March 2025 to May 2026
| Indicator | May-25 | Sep-25 | Jan-26 | Mar-26 | Apr-26 | May-26 |
|---|---|---|---|---|---|---|
| Overall lending rate | 15.18 | 15.18 | 15.10 | 15.11 | 15.33 | 15.32 |
| Negotiated lending rate | 12.99 | 12.84 | 12.25 | 12.21 | 12.56 | 11.90 |
| Overall time deposit rate | 8.58 | 8.50 | 8.33 | 8.33 | 8.54 | 8.43 |
| Negotiated deposit rate | 10.64 | 11.05 | 11.74 | 11.57 | 11.37 | 11.25 |
5. Foreign Currency Lending & Deposit Rates
Foreign currency (largely USD-denominated) lending and deposit rates remain structurally lower than their TZS counterparts, reflecting the absence of currency depreciation risk premium for lenders and the global USD rate environment. The overall foreign currency lending rate stood at 8.72 percent in May 2026, while the foreign currency overall time deposit rate was 4.47 percent — both up modestly from April.
Chart 5: TZS vs. Foreign Currency Overall Lending Rate (%) — March 2025 to May 2026
| Indicator | May-25 | Sep-25 | Jan-26 | Mar-26 | Apr-26 | May-26 |
|---|---|---|---|---|---|---|
| FX savings deposit rate | 1.33 | 0.98 | 0.77 | 1.22 | 1.68 | 1.06 |
| FX overall time deposit rate | 3.65 | 3.94 | 4.18 | 4.26 | 4.41 | 4.47 |
| FX 12-month deposit rate | 4.10 | 4.61 | 3.82 | 4.35 | 4.83 | 5.59 |
| FX overall lending rate | 8.81 | 8.43 | 8.57 | 8.70 | 8.96 | 8.72 |
6. May 2026 Rate Ladder Snapshot
The chart below consolidates the full lending and deposit rate ladder as it stood at the end of May 2026, giving a single-glance view of where funding and credit costs sit across the maturity spectrum.
Chart 6: Tanzania Lending & Deposit Rate Ladder — Snapshot, May 2026
Muhtasari kwa Kiswahili
Ripoti ya Kila Mwezi ya Kiuchumi ya Benki Kuu ya Tanzania (BOT) ya Juni 2026 inaonesha kuwa riba za mikopo na amana za benki nchini Tanzania ziliendelea kuwa tulivu mwezi Mei 2026, huku kukiwa na upungufu mdogo katika pande zote mbili.
- Riba ya mikopo kwa ujumla: Ilibaki karibu bila mabadiliko kwa asilimia 15.32, kutoka asilimia 15.33 mwezi Aprili.
- Riba ya mikopo iliyojadiliwa (negotiated) kwa wateja wakubwa: Ilishuka kwa kiasi kikubwa hadi asilimia 11.90 kutoka asilimia 12.56, ikionesha ushindani mkubwa baina ya benki kuvutia wateja wazuri.
- Riba ya amana kwa ujumla: Ilishuka hadi asilimia 8.43 kutoka asilimia 8.54, ingawa riba ya amana za miezi 12 iliongezeka hadi asilimia 10.17 — kiwango cha juu zaidi katika miezi 15 iliyopita.
- Pengo la riba (interest rate spread): Pengo baina ya riba ya mikopo ya muda mfupi na riba ya amana za miezi 12 lilipungua hadi pointi 5.22, kutoka pointi 5.50 mwezi Aprili — hii ni ishara nzuri ya kuboreka kwa ufanisi wa upatanishi wa kifedha (intermediation) katika sekta ya benki.
- Riba za fedha za kigeni: Riba ya mikopo kwa dola ilikuwa asilimia 8.72, ikiendelea kuwa chini sana ukilinganisha na riba ya mikopo kwa Shilingi (asilimia 15.32).
Kwa uchambuzi wa kina zaidi kuhusu soko la fedha la Tanzania (Government Securities Market na Interbank Cash Market), soma makala shirikishi ya TICGL: Tanzania Financial Markets Review — June 2026. Na kwa mapengo ya kisera yanayozuia uchumi wa Tanzania kufikia thamani ya Dola trilioni 1 ifikapo 2050, soma: What's Next for Tanzania's Economy?