News

Tanzania Bans Use of Foreign Currencies for Domestic Transactions

Tanzania Bans Use of Foreign Currencies for Domestic Transactions
Monday, 05 May 2025 13:18
  • Tanzania will now require all local transactions to be priced and paid in Tanzanian shillings.

  • Foreign currency contracts face tighter restrictions, and tourists must use official channels to convert money.

  • The move comes as the shilling weakens in 2025 after being one of the world’s strongest currencies in late 2024.

Tanzania has banned the use of foreign currencies for buying and selling goods and services inside the country. The Bank of Tanzania (BoT) announced the measure on May 2, stating that from now on, all domestic transactions must be carried out in Tanzanian shillings.

The ban is part of new government regulations that came into effect on March 28. These rules make it illegal to set, advertise, or quote prices in foreign currencies. Businesses can no longer accept or ask for payment in dollars, euros, or any other foreign currency. They are also not allowed to turn down payments made in Tanzanian shillings.

The restrictions go beyond day-to-day sales. Contracts written in foreign currencies are now subject to strict limits. Companies are no longer allowed to sign or renew agreements that require payments in foreign currencies after March 28. Any existing contracts in dollars or other currencies will be allowed only within a defined timeframe.

Tourists and foreigners are still allowed to use foreign currencies—but only through official channels. They must exchange their money at licensed banks or forex bureaus. They can also pay using credit or debit cards, or mobile payment systems.

This policy shift comes as the Tanzanian shilling experiences a sharp turn in its performance. While the currency strengthened by 9.51% between July and December 2024—making it the world’s top-performing currency in that period—it has since lost ground. Between April 2024 and April 2025, the shilling fell 3.6% against the dollar.

The Bank of Tanzania attributes this recent decline to seasonal changes in foreign exchange flows, along with its flexible exchange rate policy. The central bank allows the shilling’s value to move based on supply and demand, stepping in only when necessary.

Despite this, Tanzania’s foreign exchange reserves remain strong. At the end of the first quarter of 2025, the country held more than $5.6 billion in reserves, enough to cover 4.5 months of imports. The BoT expects the level to remain stable through the second quarter.

To strengthen reserves in the longer term, the central bank plans to continue buying gold and foreign exchange on the open market. It also aims to boost exports and promote import substitution—replacing imported goods with local alternatives.

The country’s broader economic outlook is positive. The International Monetary Fund reports that Tanzania’s economy grew by 5.5% in 2024, driven by better fiscal and external balances. Inflation stayed low at 3.1% on average for the year, well below the Bank of Tanzania’s 5% target. The IMF expects growth to continue in 2025.

 
 
On the same topic
• Ghana secures 450,000 barrels of light crude oil from Nigeria to stabilize power supply• Additional stocks of heavy fuel and diesel procured to sustain...
• U.S. unveils a new trade-focused approach for Sub-Saharan Africa, moving away from aid• The strategy aims to link U.S. business interests with Africa’s...
The Islamic Development Bank (IsDB) approves $665.75 million for seven African countries as part of a broader $1.32 billion...
The Central Bank of Nigeria has left its benchmark interest rate unchanged at 27.5% for the second time in a row. The decision was made after a Monetary...
Most Read
01

The African Development Bank has approved a $304 million loan to Botswana to support the southe...

African Development Bank Approves $304 Million Loan to Support Botswana's Fiscal Stability and Economic Reforms 
02

BRVM and Africa50 signed a deal to create new infrastructure financing tools The plan inclu...

BRVM and Africa50 Partner to Fund Infrastructure in WAEMU
03

The Economic Community of West African States (ECOWAS) parliamentarians met in Lomé from May 6 to 9,...

ECOWAS Parliament Calls for Airfare Tax Cuts to Make Flying Affordable
04

Nigeria’s audit industry grew 65% in 2024, reaching 28.2 billion naira ($14.4 million). KPMG, EY,...

Big Four Hold 99% Share of Nigeria’s Audit Market in 2024
05

Africa’s digital economy is growing rapidly, and the demand for data storage, processing power, and ...

Safaricom and iXAfrica Launch East Africa’s AI-Ready Data Centre Services
Enter your email to receive our newsletter

Ecofin Agency provides daily coverage of nine key African economic sectors: public management, finance, telecoms, agribusiness, mining, energy, transport, communication, and education.
It also designs and manages specialized media, both online and print, for African institutions and publishers.

SALES & ADVERTISING

Benjamin FLAUX
bf@agenceecofin.com 
Téls: +41 22 301 96 11 
Mob: +41 78 699 13 72
Média kit : Download

EDITORIAL
redaction@agenceecofin.com

More information
Team
Publisher

ECOFIN AGENCY

Mediamania Sarl
Rue du Léman, 6
1201 Geneva
Switzerland

 

Ecofin Agency is a sector-focused economic news agency, founded in December 2010. Its web platform was launched in June 2011. ©Mediamania.

 
 

Please publish modules in offcanvas position.