High capital requirements and collateral demands prevent many women and youth from entering Tanzania’s aquaculture sector. Daudi Mwasantaja from the Nyanza Cooperative Union discusses how partnerships between cooperatives and financial institutions, group guarantees, and bundled insurance can improve access to finance and create more opportunities for fish farmers.
Blog
Closing the financial inclusion gap for women and youth in Tanzania’s blue economy
Small fisheries businesses need financial products that reflect how they operate and earn income. MSC’s Elizabeth Gathu speaks with Renatus from FINCA Tanzania about the financial inclusion challenges women and youth face and the need for more suitable financing solutions.
Unlocking opportunities for women and youth through seaweed value addition in Tanzania’s blue economy
How can seaweed create economic opportunities for women and youth? Flora from Healthy Seaweed Café shares how the enterprise transforms seaweed into marketable products, creates jobs, and supports women farmers in Tanzania. She also discusses the role of financing, market access, and value addition in business growth.
Beyond access to finance- Making women-owned businesses bankable in Tanzania
While women entrepreneurs in Tanzania have adequate financing opportunities, many struggle to access capital due to collateral requirements and limited business skills. Dr. Mwajuma from TWCC discusses how tailored financial products, business training, and digital tools can help women build stronger businesses and improve their access to finance.
Unlocking finance for Tanzania’s fisheries value chain
How can Tanzania’s fisheries businesses access finance although they own productive assets, serve established markets, and receive limited attention from financial institutions?
Across Tanzania’s coastline and lakeshores, millions of livelihoods depend on nearshore fisheries and aquaculture. Most participants are micro, small, and medium enterprises (MSMEs), as highlighted in the Fisheries Sector Masterplan 21/22-36/37. These include fishers and boat owners, fish traders and processors, pond and cage farmers, seaweed farmers, hatcheries, and fish feed producers and distributors.
Although most businesses operate informally, they own productive assets such as boats, cages, nets, and cold-storage facilities. The fisheries value chain contributes 2.2% to Tanzania’s national Gross Domestic Product (GDP). Yet, financial institutions rarely serve these businesses.
The state of Tanzania’s fisheries sector
Tanzania’s fisheries sector grew from 1.4% in 2024 to 6.3% in 2025. Fish production from natural water bodies reached 519,454 metric tons in 2025, compared with 522,788 metric tons in 2024. Despite the slight decline in production, the value of fish products rose by 4.6%, from TZS 4.36 trillion (USD 1.68 billion) in 2024 to TZS 4.56 trillion (USD 1.75 billion) in 2025. Under the Fisheries Sector Master Plan for 2021/22–2036/37, the government aims to raise the sector’s contribution to GDP to 10% by 2037. This target requires higher production, stronger processing capacity, greater exports, and more investment across the fisheries value chain.
Several programs support this agenda. One is the Women and Youth Economic Empowerment in Fisheries through Inclusive Market Access Programme. TradeMark Africa and the African Continental Free Trade Area (AfCFTA) Secretariat implement this program in partnership with the Mastercard Foundation. As part of this partnership, MSC leads the access-to-finance component. The program supports 5,224 fisheries actors as they prepare to access finance. Women lead 52% of these businesses, while men lead 48%. Youth lead 55% of these businesses, and women lead 51% of them.
MSC conducted a behavioral study to understand the roles of women and young people across the fisheries value chain. The findings revealed a significant financing opportunity.
A significant financing opportunity
The foundations for financial inclusion already exist across the sector. The behavioral study found that 91% of respondents save, 82% maintain financial records, and 97% have access to mobile phones. Yet, 47% have never borrowed. Low borrower readiness, unsuitable financial products, and risk perceptions contribute to this gap. These findings point to an untapped customer base for financial institutions and investors.
Digital access offers an affordable way to reach these enterprises. Financial institutions can use digital channels to build transaction histories, assess customers, and offer suitable financial products. The opportunity extends beyond loans. Businesses need working capital, asset finance, leasing, savings, payments, insurance, and other financial solutions that address the specific needs of the fisheries value chain. How can financial institutions translate this opportunity into practical solutions?
MSC hosted a knowledge dissemination and financial partnership workshop to support Tanzania’s fisheries value chain on 16th September 2026. The workshop formed part of the Women and Youth Economic Empowerment in Fisheries through Inclusive Market Access Programme. The Financial Sector Deepening Trust (FSDT) joined financial service providers at the workshop. These included CRDB Bank, FINCA Microfinance, and the Tanzania Agricultural Development Bank (TADB). Nyanza Cooperative Union also participated. A panel discussion explored how the financial sector could expand access to finance and insurance across the fisheries value chain.
What will it take to expand finance?
The panel discussion identified several priorities that can help financial institutions develop services for fisheries businesses.
Better data and market intelligence: Financial service providers need a stronger understanding of the fisheries value chain. This can help them identify viable financing opportunities and develop products that reflect the needs of businesses at different stages of the chain.
Stronger partnerships and risk-sharing mechanisms: Credit guarantee schemes, blended finance, and other affordable risk-mitigation mechanisms can help address sector-related risks. These mechanisms can also encourage financial service providers to expand their engagement across the fisheries value chain.
Potential in alternative approaches to credit assessment: Many fisheries MSMEs have thin credit files, which means short or insufficient credit histories. Alternative data and credit-scoring models can help financial service providers assess businesses that struggle to meet conventional lending requirements.
Financial literacy among MSMEs: Stronger financial literacy can promote responsible borrowing, improve understanding of loan terms, and encourage the productive use of finance.
Digitization: Digital transactions across the fisheries value chain can reduce reliance on cash, strengthen financial records, generate useful business data, and improve product traceability. Over time, these records can help MSMEs demonstrate their financial activity and improve access to formal financial services.
Insurance: Fisheries businesses need insurance products that are accessible, affordable, and relevant to their needs. Financial service providers can bundle insurance with other financial products, such as loans, to improve affordability and uptake while protecting businesses against risks.
A new opportunity through movable collateral
Limited collateral ownership remains a major barrier to finance for fisheries MSMEs. The recently passed Secured Transactions (Movable Property) Act 2026 could help address this challenge. The Act establishes a framework for the use of movable property as security for financing. It also provides for a Collateral Registry administered by the Bank of Tanzania. Eligible movable assets include equipment, vehicles, inventory, receivables, and other forms of movable property. This framework could benefit fisheries MSMEs, particularly women- and youth-owned businesses. Many enterprises own productive assets but lack land or other conventional forms of collateral. Businesses with fish cages, boats, processing equipment, cold storage facilities, vehicles, or inventory could use these assets to support financing applications. Financial service providers must assess these assets against their requirements and the applicable legal framework.
A broader range of eligible collateral could help fisheries businesses access working capital, finance business expansion, purchase equipment, and pursue value-added activities. The framework could also give lenders greater certainty about the registration, priority, and enforcement of security interests. This could strengthen their confidence in lending to fisheries MSMEs.
FSDT views the passage of the Secured Transactions (Movable Property) Act 2026 as an opportunity to expand productive credit for underserved businesses, particularly women and youth who lack adequate collateral. FSDT also contributed to the act’s development. It worked with the Ministry of Finance and provided demand-side insights and technical support during drafting. The next step is to operationalize the framework. FSDT now works with the Bank of Tanzania to establish the Collateral Registry and develop the required regulations.
Building on existing and upcoming FSDT initiatives
The workshop also highlighted opportunities to build on FSDT’s existing and planned initiatives. These efforts can help address barriers that limit MSME access to finance.
FSDT’s alternative credit scoring initiative is currently under a pilot in the Kilombero sugarcane value chain. The initiative demonstrates how alternative data can complement traditional credit assessments and address collateral constraints and limited credit histories. Lessons from this initiative could guide similar approaches in other value chains, including fisheries.
The FinScope MSME Tanzania 2026 Survey, which is expected to launch this financial year, will provide critical demand-side data on MSMEs in Tanzania, including those in the fisheries value chain. The findings can help financial institutions understand the MSME sector, identify viable financing opportunities, and develop products that reflect business needs at different stages of the value chain.
Similarly, the recently launched EU-funded Impact Grant Fund (IGF) offers an opportunity to support innovative approaches. These approaches can help financial service providers expand financing for women- and youth-led MSMEs while addressing risks associated with lending to underserved segments.
The IGF provides grants and business growth support to MSMEs in climate-smart and inclusive growth sectors. These include sustainable fisheries and aquaculture, marine resource protection, and sustainable food cold chains. All these areas are directly linked to the fisheries value chain.
Beyond catalytic financing, the IGF uses an integrated model to reduce financing risks for youth- and women-owned MSMEs. It builds partnerships with financial service providers, asset financiers, business development service providers, and enterprise support organizations.
Moving from opportunity to action
The knowledge dissemination and financial partnership Workshop on Supporting the Fisheries Value Chain in Tanzania highlighted the importance of partnerships, evidence, innovation, and appropriate financial solutions to unlock the potential of Tanzania’s fisheries value chain.
Expansion of access to finance requires collaboration among the financial sector, government, development partners, and the wider fisheries ecosystem. Financial solutions must address the realities of fisheries businesses, including limited collateral and financial records, seasonal cash flows, and operational risks.
Tanzania’s fisheries businesses already generate economic value, employ thousands of people, and support productive enterprises across the country. The priority is to ensure that financial services reach these businesses with products and approaches that reflect their operational realities.
FSDT and MSC will continue to work with stakeholders across the financial sector and fisheries ecosystem. Together, they can develop practical solutions that expand access to finance, strengthen resilience, and support inclusive growth for women, youth, and MSMEs across Tanzania’s fisheries value chain.
Unpacking the adaptation finance gap: What makes climate adaptation financeable?
What worsens the “adaptation finance gap”?
Many reports highlight the significant climate adaptation gap, but few examine how finance is deployed downstream. Recent funding shocks have reduced climate finance flows, while fiscal constraints continue to affect governments in developing economies. As a result, donor and public resources are increasingly expected to play a catalytic role in mobilizing commercial capital.
Yet, as the examples show, intention does not always translate into action. Funds secured after an arduous accreditation process may remain underutilized, while guarantees and other catalytic instruments may fail to attract private investment. A more useful question, therefore, is not simply how to mobilize more private capital. We also need to ask where and how to deploy it most effectively.
This three-part blog unpacks the challenges of adaptation finance beyond capital availability and considers the role and limitations of catalytic capital. We also explore the crucial, often underappreciated role of nonfinancial factors in the design of inclusive finance programs.
This series particularly draws on MSC’s landscaping of inclusive climate finance in six countries: Ethiopia, Kenya, Mozambique, Nigeria, Rwanda, and Tanzania. The research used a livelihood and market-systems perspective to examine the economics, cash-flow requirements, financing constraints, and broader market conditions surrounding selected adaptation solutions.
Financeability is a continuum
Adaptation is often seen as a revenue-preserving rather than revenue-enhancing investment. This perception limits consideration of commercial finance. Indeed, commercial finance may not be appropriate in several circumstances:
- Where adaptation investments have the characteristics of public goods, private returns may be insufficient or difficult to capture;
- Avoided losses, health benefits, or time savings may raise socioeconomic welfare without generating financial returns available for repayment;
- A profitable investment may still be difficult to finance if returns arrive late, vary by season, or remain highly uncertain;
- A positive expected return does not necessarily make an investment appropriate for a household that cannot absorb poor seasons or failed investments;
- Small transaction sizes, high origination and monitoring costs, and limited aggregation can make otherwise viable transactions unattractive to lenders;
- Returns may depend on complementary inputs, services, off-take arrangements, infrastructure, regulations, or data that are not reliably available.
The first two constraints are likely to be structural, while the latter four may be transitional. An adaptation measure can generate substantial economic and resilience benefits without presenting a strong commercial financing proposition. Conversely, an activity that is difficult to finance today may become financeable as cash flows, markets, data, or delivery systems strengthen. Financeability is therefore better understood as a continuum rather than a binary distinction.
The same adaptation solution can have very different economics
MSC’s landscaping of several adaptation solutions found that financeability depends on the business or use case, not simply the technology.
Case 1: Rainwater harvesting in Ethiopia and Kenya
Our scenario analysis in Ethiopia produced the following indicative returns:
- 15% internal rate of return (IRR) when rainwater harvesting primarily supported domestic use;
- Around 32–41% when it supported productive uses.
Compared with an indicative lending benchmark of 22%, estimated using the base lending rate and a higher risk premium for small businesses, the model suggests that selected productive uses could be commercially viable. For domestic consumption alone, savings from avoided water and health costs were insufficient to service commercial finance under the modeled assumptions. In the productive-use scenarios, water tanks supported activities such as poultry rearing and small kitchen gardens. These activities generated additional income beyond avoided water expenditure. However, the model also identified an early repayment gap because productive income began to materialize only after five to six months. Repayment schedules aligned with household cash flows could therefore be more useful than a lower interest rate alone.
In Kenya, the same asset became financeable under a different arrangement. A dairy-linked asset-collateralized loan used farmers’ milk sales records for credit assessment and deducted repayments directly from milk proceeds. The water tank supported dairy productivity, while the existing cooperative and milk-payment system created a visible repayment stream.
A household water tank that mainly generates resilience and welfare benefits may require public or concessional support. The same physical asset may present a stronger financing proposition when it supports irrigated horticulture or another productive activity that generates cash income.
Case 2: Financing higher-yield livestock breeds in Tanzania
Tanzania’s dairy sector illustrates why financing higher-productivity livestock may selectively strengthen climate resilience but may also increase maladaptation risks under suboptimal conditions. Dairy upgrading can generate potentially attractive returns, but these returns vary significantly across production systems.
Our scenario analysis highlighted how a potentially profitable asset can remain unfinanceable when the complementary systems required to generate those returns are weak. A crossbred cow under optimal feeding produced an indicative IRR of around 80%. The return fell to 24% with inadequate feed and to 7% under a combined drought and poor-feed scenario. The final scenario also produced a negative net present value (NPV). These modeled scenarios do not represent observed returns for farmers. However, they raise a fundamental question: which farmers can reliably generate the cash flows required for finance, and under what production and market conditions?
So what should funders assess?
A recurring adaptation-finance bottleneck is the lack of a viable investment pipeline. A weak pipeline may reflect two very different problems. The underlying commercial economics may be poor, or promising adaptation opportunities may lack the preparation, structure, or evidence required to attract finance. Distinguishing between these problems is critical. Better evidence and investment preparation can help establish credible economics, appropriate cash-flow structures, effective risk allocation, and suitable partnerships1.
Commercial finance requires repayment. Analysis should therefore begin with the economics of the adaptation activity and the extent to which investors or borrowers can capture its returns. A well-designed adaptation finance intervention should consider the following questions:
MSC’s adaptation finance framework uses a modular approach to apply these questions, identify investable adaptation use cases, and appropriate financing models. MSC’s adaptation finance stack provides a complementary discussion of the broader challenges involved in delivering adaptation finance to end users.
Conclusion
Public and concessional resources are scarce, but commercial capital cannot replace them. Using public or concessional resources where commercial economics already work may waste subsidies. Expecting private capital to participate where borrower-level economics do not work may waste time.
Successful adaptation finance initiatives can help identify promising business cases and shape future investment portfolios. The next step is to test these distinctions under real market conditions.
An adaptation finance lab could test a small portfolio of use cases, define the financing hypotheses and conditions for commercial viability in advance, and transparently track repayment, resilience outcomes, and the additionality of public support. The resulting evidence should show whether private capital can participate and, more importantly, where, for whom, and under what conditions it should.
