Timiza Akiba successfully encourages Tanzanians to save
Timiza Akiba successfully encourages Tanzanians to save
Airtel and Letshego Bank Tanzania partnered with financial technology company JUMO in 2018 to introduce the first fee-free, interest-bearing mobile money savings account called Timiza Akiba. The initial aim – to drive a savings culture among the people of Tanzania and help them reach their business or personal financial goals – is showing signs of sustained success.
As a paperless and safe mobile-centric service, Timiza Akiba allows Airtel customers to set up a savings account and save any amount from TSH 100 up to TSH 5 Million directly from their phones, without having to handle cash or travel to a bank. The funds are managed by Letshego Bank and customers receive competitive rewards for not withdrawing from their savings for a 30-day period. Withdrawals are, however, accessible and available at any time with no transaction costs, in the event of an unexpected expense or emergency.
In March 2020, total assets under management for Timiza Akiba hit a record high, increasing 32% in just three months from December 2019. This growth is largely due to an increase in the number and value of customer deposits for March 2020 and the amount of active customers increasing 9% in the month of March, compared to the most recent 6-month average. This indicates that an increasing number of Tanzanians are choosing to save, where possible, at this uncertain time.
Many customers, like small business owner Olivia Beatus, choose to save with Timiza Akiba because they can deposit small amounts, gradually working towards a big financial goal.The capital for Olivia’s fabric and beauty product business came from depositing small amounts daily to save up to buy stock. Some days, her savings came to less than a dollar. “With Timiza Akiba, I can save a thousand shillings ($0.43) at a time, or even less. Amounts that I would not be able to deposit at a bank,” she says.
Erick David, a security guard from Dar es Salaam, has similar aspirations to Olivia’s. He is saving for capital to build multiple income streams by running various agricultural businesses. He used to save his money in a traditional bank account, but it became inconvenient when making deposits meant hours traveling to the bank. He noticed the Timiza Akiba option on his mobile money menu and decided to try it, making his first deposit then and there. “It’s easy to save with Timiza Akiba—right there in my hands on the phone,” Erick says.
Airtel Tanzania makes Timiza Akiba available to all Airtel Money customers through their mobile network and USSD functionality which works with any feature phone and doesn’t require access to data. “Timiza Akiba runs on mobile money so deposits and withdrawals can be made digitally and your savings remain safe at a time when we all need to curtail our luxury spending,” says Isack Nchunda, Airtel Tanzania Airtel Money Director.
As the Timiza Akiba fund manager, Letshego Bank’s CFO Andrew Tarimo echoes this sentiment. “Digital payment apps and gateways are a safer alternative to dealing with cash especially during the Covid-19 pandemic. Timiza Akiba offers a secure, rewarding way of saving money for emergencies, business, family or the future during this time of economic uncertainty.”
JUMO builds and operates short-term, structured and long-term financial products for emerging markets. “Our technology stack reduces unit economics on the delivery and administration of financial services so that partners can reach new markets and customers can access high value products,” says JUMO’s Africa CEO, Buhle Goslar. “Our partnership with Airtel and Letshego in Tanzania has reduced the barriers to access to savings significantly and it's encouraging to see how Timiza Akiba has grown, especially in recent months.”
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