Tanzania’s NMB Bank secures $100 million SME loan from World Bank arm 

World Bank Group, through its private sector arm, International Finance Corporation, is preparing to extend up to $100 million in local-currency financing to NMB Bank Plc, strengthening the capacity of the lender, which currently ranks as Tanzania’s second-largest lender by market share, to expand lending to micro, small and medium enterprises, including women-owned businesses, in one of East Africa’s fastest-growing banking markets.

The facility, structured as a Tanzanian shilling-linked senior loan with a tenor of up to five years, including a two-year grace period, will support NMB’s strategy to scale lending to micro, small, and medium enterprises (MSMEs), with a dedicated focus on women-owned businesses.

Expanding access to SME finance

Proceeds from the financing will be channeled toward growing NMB’s MSME loan portfolio, with at least 20% earmarked for women-owned MSMEs, a segment that remains underserved despite its critical role in economic growth.

The project forms part of IFC’s MSME Finance Platform, a broader initiative designed to unlock funding for small businesses in challenging markets, where access to credit remains constrained by risk perceptions and limited long-term capital.

Blended finance structure

Of the total financing, up to $40 million will be supported by a first-loss guarantee provided under the International Development Association (IDA) Private Sector Window Blended Finance Facility, helping de-risk the investment.

The remaining $60 million will be deployed on a standalone basis, reflecting a hybrid financing structure aimed at crowding in private capital while maintaining commercial discipline.

IFC estimates the concessional support embedded in the structure at approximately 6.3% at the program level, a subsidy designed to make SME lending viable in higher-risk environments.

Strengthening Tanzania’s banking sector

Headquartered in Tanzania, NMB is the country’s second-largest bank, accounting for roughly 23% of net loans and about 30% of industry profitability. The bank is listed on the Dar es Salaam Stock Exchange and serves a broad customer base spanning retail clients, SMEs, corporates, and government institutions.

Its shareholder base includes Arise B.V. with a 34.9% stake, the Government of Tanzania holding 31.8%, alongside public and institutional investors.

Driving financial inclusion and standards

Beyond funding, IFC’s involvement is expected to enhance NMB’s environmental and social risk management systems, aligning the bank with international best practices.

The partnership will also introduce enhanced due diligence frameworks, including safeguards addressing sexual exploitation, abuse, and harassment risks within lending operations.

Supporting private sector growth

The financing is expected to improve access to credit for thousands of small businesses across Tanzania, while demonstrating the viability of blended finance structures in frontier markets.

By easing liquidity constraints and extending longer-term funding, the initiative positions NMB to play a more prominent role in supporting entrepreneurship, job creation, and broader economic development in East Africa’s second-largest economy.