CONSUMER PROTECTION IN DIGITAL LENDING IN TANZANIA: AN ASSESSMENT OF THE EFFECTIVENESS OF THE LEGAL FRAMEWORK AND REGULATORY CHALLENGES

The expansion of digital lending has changed the way individuals access credit in Tanzania. Through mobile applications, mobile money platforms and other technology-based services, borrowers can obtain loans without visiting a physical financial institution. Although these services have improved the convenience and accessibility of credit, they have also raised concerns about the adequacy of consumer protection, particularly in relation to disclosure of loan terms, transparency of charges, personal data protection, debt collection practices and access to effective remedies. This article examines the effectiveness of the legal framework governing consumer protection in digital lending in Tanzania. It adopts a qualitative approach combining doctrinal legal analysis with a review of findings from research involving stakeholders in the digital lending sector. The article examines the relevant legislation, regulatory instruments and institutional arrangements, while assessing how far these measures protect consumers in practice. It argues that Tanzania has established a legal foundation for consumer protection, but the practical effectiveness of that protection remains affected by fragmented regulation, enforcement difficulties, limited consumer awareness and challenges in accessing complaint and redress mechanisms. The article recommends clearer requirements for digital lending, stronger coordination among regulatory institutions, improved protection of personal information and more accessible mechanisms for resolving consumer complaints.