Abstract:
This study was set to determine the elements of financial ecosystem in Tanzania while looking
over to bridge the gap created to SMEs in Tanzania due to the fragmented ecosystem. The
Tanzania Development Vision 2025 highlighted that small and medium sized enterprises (SME)
sector as among the key contributor to the long-term development. However, key constraints
remain for SME development includes undeveloped infrastructure, market access, ineffective
business development services, technology, unfavorable legal frameworks and limited access to
finance. This study explored the financial ecosystem for SMEs in Tanzania, which substantially
affect their growth, development and low contribution to the GDP in Tanzania. Specifically, the
study aimed to identify the elements of financial ecosystem in Tanzania for the Small Medium
Enterprises. The study employed a descriptive design in which purposive sampling techniques
was used to obtain study sample of 120 SME’s owners while using questionnaires and interview
as data collection methods. The finding indicate that majority of the respondents argued that
financing schemes, education and awareness, debt resolution programs and access to credit to
be elements of financial ecosystem. To contribute in bridging the gap existing in the financial
ecosystem, this study recommend various debt resolution mechanism and programs should be
enhanced so as to enable Small SME’s owners to acquire various loans and credit from financial
institutions with assurance of the repayment.
