Development Entrepreneurship for Community Initiative members gather to learn the fate of their contributions after the organisation was dissolved. PHOTO|FILE
Sometimes we work so hard…. like donkeys to make money. And our bodies get tired.
We are young and the next day, we are old. Years seem to overrun as we grow older. By the time you reach 40 years, you realize there are things your bones cannot take any longer.As you make money, it is important to make sure you think and make good on how your money can work for you.
They say make sure you work hard, and also let your money work hard for you. When you reach a point when your money is working for you it is what is called investments.
The best way for anyone to take charge of financial security is investing your money where you think you can grow your wealth and generate income ahead of retirement.
I think many Tanzanians know this and thus they love to invest. Unfortunately, at times, they have taken their money to the worst places, and the losses have been huge. One of the best examples of things gone wrong has been the misguided love for financial pyramid schemes.
Do you remember the outlawed Development Entrepreneurship Community Initiative (DECI)? Records show that, it had attracted approximately 700,000 people who invested in its scheme. The promise was a return of 200 percent returns on investment in just 8 weeks after one is investing!
Yet, without revealing its profit-making formula, DECI managed to capture the imagination of so many people who were interested in investing for such a good return. The infamous firm sank with billions of innocent inventors cash! All the customers wanted was an investment vehicle that could guarantee them a great return! Since then the government has been quickly putting to an end other illegal schemes reported so as to protect the public.
Another factor that tells that Tanzanians love to invest is the uptake in Savings and Credit Cooperatives Societies (SACCOS) and “village community banks,” popular know in Kiswahili as VICOBA.
Currently, these are the lifeline of many people both in rural and urban areas, who put their hard-earned money, for divided and also to be able to borrow in hard times.
Back in 2003, the government set up Unit Trust of Tanzania (UTT) with the mandate of promoting collective investment schemes and encourages a savings culture. So far this has been one of the best investment options for the common mwananchi. The UTT is regulated and government-backed, thus making it a good investment vehicle for Tanzanians and even foreigners.
In Tanzania’s financial markets perhaps the most popular investment scheme is a saving account from the numerous banks that are licensed by the Bank of Tanzania (BOT). There are financial instruments like equities (stock market) and bonds among others.
Some investments are interest-based while others are non interest (faith based) investment. For instance, for the latter, it was recently great to see the first sharia-compliant bond (Sukuk bond) issued in the country.
The Citizen reported that the bond was oversubscribed by 36 per cent. Experts are of the view that the bonds are vital for religious-conscious investors as well as those who are not religious but they love sharia-compliant finance models.
The bond was approved by Capital Markets and Securities Authority (CMSA), meaning that it has complied with all the government requirements.
It’s therefore important to have more products like this in the financial markets that are fully regulated, so as to quench the great thirst for Tanzanians to invest.
It’s also important that we encourage each other to invest. It should be noted that by diversifying our investments (investing in different areas and maximizing returns/income) we prepare for the betterment of our own future and for the development of our national economy.
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