Small-scale gold miners in Songwe have secured a TZS50 billion loan from CRDB Bank to invest in working capital, mining equipment and mineral processing, in a move expected to increase production and strengthen their contribution to Tanzania's mining industry.
The financing, extended to Songwe Gold Family (SGF), is part of efforts to address one of the major constraints facing small-scale miners: limited access to capital needed to acquire modern equipment, expand operations and improve productivity.
Minister for Minerals Anthony Mavunde witnessed the loan handover, urging the beneficiaries to invest the funds in the activities for which they were secured rather than diverting them to other uses.
He said access to affordable financing was essential in helping small-scale miners move from low-capacity operations to more productive and commercially sustainable businesses.
"The government will continue creating an enabling environment for small-scale miners through access to capital, mining licences and geological information to support productive mining activities," he said.
Mr Mavunde said the government was also working to expand opportunities for small-scale miners by reallocating mining areas whose licences had been repossessed after their holders failed to develop them.
He commended President Samia Suluhu Hassan for directing that such areas be made available to small-scale miners, saying the move would enable more Tanzanians to participate in the mining sector.
The minister said action against holders of inactive licences would continue to ensure that mineral-rich areas were put to productive use and benefited the wider economy.
In a further effort to widen participation in the sector, Mr Mavunde issued small-scale gold mining licences to 81 groups under the Mining for a Brighter Tomorrow (MBT) project.
The initiative targets young people, women and people with disabilities, with the aim of enabling them to participate in different stages of the mineral value chain.
The expansion of licensing and access to finance is expected to create opportunities for groups that have traditionally faced difficulties entering the capital-intensive mining business.
CRDB Bank Director of Branches and Small and Medium-sized Enterprises Bonventure Poul said the bank would maintain its partnership with the Ministry of Minerals to improve access to financing for small-scale miners, mineral processors and mineral traders.
He said the bank had extended loans worth TZS426 billion to the mining sector, of which TZS150 billion had gone to small-scale miners.
The financing, he said, reflected the bank's commitment to supporting local participation in mining and helping operators expand their businesses.
Songwe Regional Commissioner Abubakar Kunenge said the government would continue supporting small-scale miners because of their contribution to economic activity and development in the region and the country.
However, Songwe District Commissioner Dickson Nickson identified inadequate access to electricity in mining areas as a major challenge affecting operations.
He urged the government to accelerate the extension of electricity to mining sites, saying reliable power supply was important for improving efficiency and supporting the use of modern mining and processing equipment.
Songwe MP Philip Mlugo commended the government for creating opportunities for small-scale miners and called on other financial institutions to emulate CRDB by extending financing to the sector.
The latest financing initiative highlights the growing importance of access to capital, reliable infrastructure and secure mining rights in enabling small-scale operators to increase production and capture greater value from Tanzania's mineral resources.