Banks’ Trade Financing and its Contribution to SMEs Development in Tanzania “The Case of Selected SMEs in Dar es Salaam City, Tanzania”

Abstract

The paper explores the Banks’ trade finance and its contribution to SMEs development in Tanzania with reflection in Dar es Salaam region. Data for study were collected using questionnaires and interviews from SMEs owners and Commercial bank workers in selected areas. A descriptive design was opted for the purpose of describing the state of affairs as it exists. This enables the researcher not only to be strict to fact findings but also formulate important principles of knowledge and solution to significant problems. The result indicates that SMEs owners lack knowledge on trade finance services offered by commercial banks and they have concentrated on loans and deposit services leaving trade finance services which is an option for external trade. Traders take high risk by travelling to abroad to fetch manufactured goods carrying cash on their hands. This imply that trade finance is new in Tanzania environment, but if it could be provided it could bring a great results to SMEs growth.