In achieving collective development, especially in ensuring groups of women, youth and Persons with Disabilities benefit from 10% interest-free loans, UNA Tanzania is to lead the process of developing guidelines and management of 10% loans. This work is a continuation of UNA Tanzania’s work in ensuring that interest-free loan funds benefit women, youth, and Persons with Disabilities. In establishing income generating development activities such as trade, livestock keeping, and production of a wide range of products.

This step is a continuation of the successful implementation of the Local Government Finance Act amended in 2018 (Cap 290, Section 37A). This amendment requires all councils in the country to allocate funds from their local revenue for loans to groups of women, youth, and persons with disabilities. These legislative amendments were followed by the formulation of regulations specifying the conditions, criteria for the provision and management of loans provided by the council to such groups.

On 13/10/2020 UNA Tanzania and Policy Forum participated in a strategic session held by the Local Government Department Leadership (TAMISEMI). In this session, it was noted that despite there being laws and regulations governing the coordination of these loans at council levels, there are still many challenges facing the structure and procedures of the provision and management of loans to groups of youth, women, and persons with disabilities in the country. Describing the challenges, Assistant Director of the Local Government Department, Ms. Angelista Kihaga, explained that despite loans worth more than 91 Billion Shillings being offered to groups of youth, women and persons with disabilities, there is still a problem with management and presence of fake groups. He explained that most administrators do not have adequate skills to manage groups so that they can implement sustainable development activities and be able to generate funds that will be paid back to respective councils. He stressed that there is a need to build the capacity of these administrators to bring about the productivity of the loans given to group members.

Challenges like, lack of funding and skills to conduct monitoring for groups that received loans were described as one of the difficulties facing councils in the country. This challenge goes hand in hand with the lack of professional equipment especially computers for the maintenance of records of the issuance and repayment of loans issued. Ms. Kiaga pointed out that there is need to continue providing training to groups on how to do entrepreneurial activities so that these groups can be successful in their projects and be sustainable that will help increase the income of group members and facilitate timely and effective repayment of loans.

Talking about how to solve the challenges that exist in managing the operations and system of issuing and repaying loans, UNA Tanzania official who will lead the guidance preparation exercise, Mr. Lucas explained that the lack of appropriate guidance that will lead to the effective implementation of regulations and laws is part of the challenges of operating these loans. Emphasizing this, the Director of the Local Government Department, Dr. Charles Mhina said that the existence of rules and regulations governing these 10% loans is good, but there is need to have guidelines that will show the best way and help provide a deeper interpretation and give friendly instructions in the implementation of those rules. He gave an example about the structure of groups which also needs to be looked at to make sure that these groups function as outlined in the analysis of the business idea. He also emphasized the need to develop a sound guide that will enable the process of issuing and repaying loans to be easier and more productive for the beneficiary groups and cement the understanding of the importance of repaying back loans that has grown to be a major problem.

Speaking in response to one of the arguments raised by the UNA Tanzania coordinator, who touched on changes in regulations, Dr. Mhina made it clear that the Government has prepared a draft amendment to existing regulations governing the provision and management of loans to youth, women, and persons with disabilities. These code changes are part of the UNA Tanzania long-term vision that was presented by PO-RALG on several occasions. He noted that these changes are to ensure that the regulations grow friendly and productive in the issuance of these interest-free loans. However, he pointed out that it is important that “in order to have good guidance we must have strong principles”.

At the end of the session, resolutions were put in place, including the creation of a preparation task force to be led by UNA Tanzania, who will be tasked with overseeing and ensuring that the process is completed on time. The working group will include stakeholders from PO-RALG and Policy Forum as well as other stakeholders who will sit together for thirty (30) days and prepare a guide that will incorporate the ideas of other stakeholders. When completed the manual will be disseminated at the relevant levels to facilitate and maintain greater efficiency in the system of lending and management of loans to youth groups, women, and persons with disabilities in the country.