Abstract:
The study was meant to assess factors affecting individual investors in commercial banks in
commercial banks of Tanzania. The tasks were to determine the extent to which income, withholding
Tax, the Bank image and the Interest rate affect individual Investors decision making at selected
commercial banks within Dar es Salaam region. Descriptive research design was employed with
quantitative approach. Google questionnaire was used to collect data from 138 Respondents and
data analysis was conducted using descriptive statistical analysis. The study concludes that there is
positive influence of Bank image on individual investor’s decision making in commercial banks
because Bank image have positive significant power to influence individual investors in buying and
selling shares and buying and selling shares and other bank investment products due to gut feeling
which they receive after being investors in these. Respondents mentioned CRDB and NMB prefer to
invest compared by other banks. The study also concludes incomes does not influence individual
investors in buying share, bonds, investing in fixed accounts. The study showed source of income for
many individual investors is wages and their living standard of many investors is medium while
income expenditure does not involve budget of the investing on buying shares, bonds since it is not
enough. The study concludes also that withholding tax does not influence individual investors
towards in investing in commercial banks because the withholding tax is not fair and also it is not
flexible. Also the withholding tax payment procedure is very complicate not simple that why they
influence negatively individual investors towards making decision of buying shares, bonds and
other bank investment products. Finally, the study recommends that in order to enhance individual
investment decision there is need Commercial bank listed by DSE to continue to publish their
annual reports in order to provide stakeholders with access to performance data. The law on
withholding tax in investment return especially on dividend should be reconsidered and reduced
from 5% percent until 3 percent of the investment return if it is at all necessary to have such a law.
