tl;dr
Tanzania’s government-led Tanzania Instant Payment System (TIPS) has significantly expanded its transaction volume, processing $11.66 billion across 454 million transactions in 2024. Unlike Kenya and Nigeria, which rely on private fintechs, Tanzania’s approach emphasizes financial inclusion throug...
**Tanzania’s State-Led Payment Revolution: How TIPS is Reshaping Africa’s Financial Landscape**
In a continent where mobile money has become the lifeblood of economies, Tanzania is blazing its own trail. While most African nations rely on private-sector fintechs to drive digital payments, Tanzania has embraced a government-led approach with its **Tanzania Instant Payment System (TIPS)**. Last year, the system more than doubled its transaction value, processing **TZS 29.90 trillion ($11.66 billion)** across 454 million transactions in 2024—a stark leap from the $4.88 billion handled in 236 million transactions in 2023.
TIPS, developed by the **Bank of Tanzania (BOT)**, is a real-time payment network connecting banks, mobile money platforms, and other financial institutions. It’s not just about speed; it’s about **financial inclusion**. By enabling instant transfers between platforms, TIPS has become a cornerstone of Tanzania’s digital infrastructure, bridging gaps for millions of unbanked citizens. “TIPS unifies the payments landscape,” says **Mutashobya Mushumbusi**, BOT’s head of retail payments. “It’s a catalyst for economic growth and financial empowerment.”
### A Different Path: Tanzania vs. Kenya and Nigeria
Tanzania’s approach contrasts sharply with neighbors like Kenya and Nigeria. Kenya, a digital payments powerhouse, relies on private giants like **M-Pesa**, which alone has **320,000 mobile money agents** nationwide. In 2024, Kenya’s mobile money sector hit **$67 billion** in transactions. Meanwhile, Nigeria—Africa’s largest economy—dominated with **N1.07 quadrillion ($702 billion)** in digital payments, driven by the **NIBSS** real-time interbank system.
Yet Tanzania’s government-led model has its own strengths. With **52,000 financial access points** (ATMs, mobile money agents), TIPS has brought digital services to rural areas where private networks might not reach. The system’s interoperability ensures that users can send money across platforms—whether through a bank, fintech, or mobile money operator—without friction.
### Global Parallels: Pix, UPI, and the Rise of Real-Time Payments
Tanzania isn’t alone in betting on state-led instant payment systems. **Brazil’s Pix** and **India’s UPI** have become global benchmarks. By mid-2024, **93% of Brazilians** used Pix, with monthly volumes hitting **$500 billion**. India’s UPI, which processed **$3.1 trillion** in 2024, is now expanding beyond borders, handling nearly half of global real-time transactions.
TIPS, launched in 2018 and built entirely by Tanzanian developers, mirrors this trend. Its success underscores a growing belief that national systems can drive innovation tailored to local needs, rather than relying solely on private players.
### Gabon’s Digital Leap: Africa50 to the Rescue
While Tanzania focuses on payments, **Gabon** is taking a broader approach to digital transformation. The Central African nation has partnered with **Africa50**, a pan-African development initiative, to digitize government services, expand internet access, and launch a **sovereign cloud platform**.
Africa50, backed by 32 African states and $900 million in committed capital, aims to accelerate digital infrastructure across the continent. In Gabon, the partnership will initially target **digitizing government services** for 2.6 million citizens, with future plans to expand into payments, identity systems, and internet coverage.
Gabon’s digital economy currently contributes a modest **12% to its GDP**, but the government is aiming higher. Last year, the World Bank funneled **$72 million** into Gabon’s **Digital Gabon** initiative, signaling a push to make technology a pillar of economic growth.
### The Road Ahead
As Tanzania’s TIPS scales and Gabon’s digital ambitions take shape, the message is clear: **Africa’s financial future is being shaped by innovation, whether state-led or private-sector driven**. With real-time payment systems like TIPS and UPI fueling economic growth, and partnerships like Africa50 driving broader digital transformation, the continent is proving that financial inclusion and technological advancement go hand in hand.
For investors and policymakers, the lesson is simple: **the next big wave in global finance is happening in Africa—and it’s being powered by systems like TIPS.**