Agent banking and mobile-enabled financial services have brought banking within reach of millions of Tanzanians who never entered a branch. That reach comes with regulatory responsibility. The Bank of Tanzania (BOT), acting under the Banking and Financial Institutions Act and its subsidiary regulations and guidelines, holds licensed institutions accountable for the conduct of their agents and the integrity of their digital channels. This alert flags the areas providers should keep under review.
The Bank Remains Responsible
The foundational principle of agent banking is that the appointing institution remains fully responsible to the customer for the acts and omissions of its agents. Outsourcing the counter does not outsource the liability. A bank must therefore satisfy itself, on a continuing basis, that each agent is competent, adequately trained, and operating within the scope of the services permitted.
Agent Selection and Approval
The guidelines set out due-diligence requirements before an agent is appointed - assessing the prospective agent’s standing, the security of the premises and, where required, obtaining regulatory approval. Institutions should maintain a documented approval trail for every agent, and a register of active agents that reconciles to the network on the ground. Ghost agents and unapproved sub-agents are a familiar source of regulatory findings.
Permitted and Prohibited Services
Agents may carry out only the services the institution is authorised to delegate - typically cash-in and cash-out, account opening support, bill payments and similar transactions - within prescribed transaction limits. Certain activities cannot be delegated to an agent at all. Providers should ensure that agent training and system controls prevent agents from straying beyond their permitted scope.
Know-Your-Customer and Anti-Money-Laundering
Agent and digital channels do not dilute customer due diligence obligations under the Anti-Money Laundering Act and its regulations. Institutions must ensure that identity verification, transaction monitoring and suspicious-transaction reporting operate across agent and digital transactions just as they do at the branch. Tiered KYC for low-value accounts is permitted within the framework, but the monitoring obligation is not switched off.
Consumer Protection and Transparency
The BOT’s financial consumer protection framework requires clear disclosure of charges, fair treatment of customers, and accessible complaint-handling. For agent and digital services this means:
- visible display of tariffs and the agent’s status as an agent of the named institution;
- transaction receipts and confirmations;
- a functioning complaints channel with defined turnaround times;
- protection of customer funds and data.
Data and Systems Resilience
Digital financial services depend on systems that must be secure and available. Institutions are expected to manage operational and cyber risk, protect customer data consistently with the Personal Data Protection Act, and maintain business continuity so that customers are not stranded by outages. Third-party technology providers should be bound by contracts that pass these obligations down the chain.
What Providers Should Check Now
- Reconcile your active agent network to your approved-agent register.
- Confirm agents operate only within permitted services and limits.
- Test KYC and transaction-monitoring coverage across agent and digital channels.
- Review tariff disclosure, receipts and complaint-handling for consumer-protection compliance.
- Assess cyber resilience and data protection across your digital platforms and vendors.
The direction of travel is clear: greater financial inclusion matched by greater accountability. Institutions that treat their agents as an extension of the bank - supervised, trained and monitored - will be well placed as the BOT continues to refine the rules.
For general information only - this material does not constitute legal advice.
Eric Frank Ringo is a Principal Partner at FIN & LAW, an Advocate and Arbitrator in Tanzania. Eric has over 20 years’ post-qualification practice focusing on tax, corporate,…
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