Mobile Money and Banking Regulatory Environment

In Tanzania, the mobile money services are offered by mobile networks operators in
collaboration with some commercial banks as stipulated in the legal and regulatory
requirements of the mobile phone payment system. According to BOT’s report
(2011) on “Tanzania Mainland’s 50 Years of Independence: The Role and Functions
of the Bank of Tanzania “mobile service providers are required to partner with
commercial banks in the provision of mobile money services. This arrangement
looks complicated in its operations and open gaps in the regulatory framework since
the two collaborators are regulated by two different regulators, with mobile phone
payment services being regulated TCRA while commercial banks regulated by BOT.
In this arrangement BOT deals with financial transactions, while the Tanzania
Communication Regulatory Authority (TCRA) focuses the communication
infrastructure. In acknowledgment of the consequence of developing a meticulous
supervisory oversight for this quick developing mobile banking industry, the Bank of
Tanzania signed a Memorandum of Understanding with TCRA which points
out a mechanism for regulatory and supervisory coordination between the two
regulators.