The Bank of Tanzania (BoT) has banned the use of foreign currencies in domestic transactions.
BoT announced the decision publicly on May 2, 2025.
The new regulation, effective from March 28, aims to strengthen the Tanzanian shilling and enhance financial control.
The ban applies to all foreign currencies, including the US dollar and the euro.
Businesses can no longer quote, advertise, or set prices in foreign currencies.
All payments for goods and services must now be made in Tanzanian shillings.
The central bank emphasized the importance of using local currency for economic stability.
BoT stated that no one is allowed to reject payments in Tanzanian shillings.
Contracts signed after March 28 must not include foreign currency clauses.
Existing contracts can continue under transitional provisions, though details remain undisclosed.
BoT has introduced strict rules for contracts involving foreign currencies.
The central bank seeks to limit foreign currency dependence within the domestic market.
Tourists and non-residents remain exempt from the new rules.
They can continue using foreign currencies through official channels like licensed banks and forex bureaus.
Credit and debit cards are still acceptable for foreign currency payments.
Mobile payment platforms are also permitted for such transactions.
The ban follows recent volatility in the Tanzanian shilling’s value.
The shilling gained 9.51% against the US dollar in late 2024.
However, it fell 3.6% between April 2024 and April 2025.
BoT attributed the depreciation to seasonal changes in foreign exchange supply.
Despite challenges, the central bank supports a flexible exchange rate regime.
BoT intervenes only when necessary to ensure market stability.
Tanzania’s foreign exchange reserves remain strong despite recent currency pressures.
By early 2025, reserves stood at $5.6 billion.
These reserves can cover 4.5 months of imports, BoT reported.
Officials expect reserve levels to remain steady in the near term.
The government plans to support the shilling through strategic economic policies.
Measures include gold purchases, boosting exports, and reducing imports.
The International Monetary Fund reported 5.5% GDP growth in 2024.
Tanzania also maintained low inflation and improved fiscal conditions during this period.
The IMF forecasts continued growth for 2025, supporting BoT’s optimism.
Authorities believe the currency reform will enhance long-term economic resilience.
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