Executive Summary
Tanzania’s Finance Act, 2026 and the accompanying Electronic Transactions (Mandatory Electronic Payments for Specified Transactions) Order (Government Notice No. 158C of 2026) require a broad range of high-value and everyday commercial transactions to be settled through electronic payment channels with effect from 1 July 2026. The reform amends section 13 of the Electronic Transactions Act to mandate electronic payment for transfers of land and motor vehicles, and empowers the Minister of Finance to extend the requirement to further sectors.
Affected sectors now include real estate, motor vehicles, fuel stations, retail and hospitality, entertainment and events, education, and agricultural cooperatives. Critically, proof of electronic payment is a precondition to registering ownership transfers of land, buildings, and motor vehicles, as the Ministry of Lands, TRA, and BRELA must verify digital payment records before approving transfers.
Non-compliance carries serious consequences, including the inability to complete ownership transfers, regulatory and tax exposure, and reputational and commercial risk. Businesses should act now to map affected transactions, establish compliant payment channels, integrate electronic fiscal devices, update contracts, and retain proof of electronic payment. The remainder of this article examines the new requirements, affected transactions, consequences, and practical steps in detail.
Tanzania’s Shift Toward a Cash-Lite Economy
For decades, cash has been king in Tanzania’s commercial life from multi-million-shilling land deals sealed with bundles of banknotes to used-car sales finalized in currency counted by hand. That era is ending.
With the passage of the Finance Act, 2026 (No. 2 of 2026), gazetted on 30 June 2026, and the accompanying Electronic Transactions (Mandatory Electronic Payments for Specified Transactions) Order (Government Notice No. 158C of 2026), Tanzania has taken a decisive step toward a digitally driven, traceable economy. Effective 1 July 2026, a wide range of high-value and everyday commercial transactions must now be settled through electronic payment channels.
The policy rationale is clear: improve transaction traceability, strengthen tax compliance, enhance transparency in asset transfers, and curb illicit financial flows. Tanzania’s digital payments infrastructure has already demonstrated its capacity—the Tanzania Instant Payment System (TIPS) processed 651 million transactions worth TZS 54.95 trillion in 2025, up from 453 million transactions valued at TZS 29.82 trillion just a year earlier. The regulatory framework is now catching up to the technology.
This article explains what the new law requires, which sectors and transactions are affected, the consequences of non-compliance, and what businesses should do right now to prepare.
The New Mandatory Electronic Payment Requirements
Legislative Framework
The legal architecture for Tanzania’s mandatory electronic payment regime rests on the following instruments:
The Finance Act, 2026 (No. 2 of 2026) – published in Special Gazette No. 8 Vol. 107, dated 30 June 2026. Among other reforms, the Act amends the Electronic Transactions Act [Cap. 442 R.E. 2023] by introducing new subsections (2) and (3) to section 13.
Section 13(2) of the Electronic Transactions Act (as amended) – provides that any person transferring land or a motor vehicle is required to make the relevant payment through electronic means.
Section 13(3) – empowers the Minister of Finance to publish an order specifying additional transactions requiring electronic payment.
Government Notice No. 158C of 2026 – the Electronic Transactions (Mandatory Electronic Payments for Specified Transactions) Order, published 30 June 2026. This order schedules the full list of specified transactions requiring electronic settlement.
Key Principle: Proof of Electronic Payment as a Precondition
Perhaps the most impactful aspect of the new regime is this: proof of digital payment is now a mandatory precondition for the transfer of ownership of land, buildings, and motor vehicles.
Public institutions including the Ministry of Lands, the Tanzania Revenue Authority (TRA), and the Business Registrations and Licensing Agency (BRELA) are required to verify digital payment records before approving ownership transfers. In practical terms, this means a cash-only transaction cannot be registered, and the buyer risks holding an unenforceable interest.
Transactions and Sectors Affected
Government Notice No. 158C schedules a broad range of transactions and commercial activities. The following sectors are now subject to mandatory electronic payment requirements:
Real Estate and Property
Payments for the renting, sale, or purchase of a building, plot, or farm
Both the payer and the recipient must transact electronically
Motor Vehicles
Sale or purchase of motor vehicles, whether new or used
Fuel and Transport
All transactions at fuel/filling stations
Retail, Hospitality, and Entertainment
Shopping malls
Hotels, restaurants, cafés, and tourism businesses
Cinemas and theatres
Gymnasiums (gyms)
Events and Conferences
Conference and event venues
Sports arenas
International trade exhibitions, including Saba Saba and Nane Nane
Education
All payments to schools, colleges, and universities
Agriculture
Agricultural marketing activities conducted through cooperative unions and agricultural marketing cooperative societies (AMCOS) dealing in strategic crops, including coffee, cotton, cashew nuts, tea, tobacco, and sisal
Note: The Minister of Finance retains the power to expand this list by further order. Businesses should monitor the Government Gazette for updates.
Consequences of Non-Compliance
The consequences of failing to comply with the mandatory electronic payment requirements are significant and multi-dimensional:
1. Inability to Complete Ownership Transfers
The most immediate and practical consequence for high-value transactions: without proof of electronic payment, the Ministry of Lands, TRA, and BRELA will not approve the transfer of ownership of land, buildings, or motor vehicles. A cash-only deal is, in effect, unregistrable leaving the buyer without legal title and potentially without legal recourse.
2. Regulatory and Criminal Exposure
Non-compliance with electronic transaction and payment obligations under Tanzanian financial-services and payment-systems legislation generally exposes parties to offenses, fines, and in some regimes, imprisonment. By way of illustration, under the National Payment Systems Act, contraventions can attract fines of not less than TZS 50 million for natural persons, or imprisonment of up to five years, or both. Businesses should expect the enforcement environment surrounding GN 158C to carry similarly serious consequences.
3. Tax Compliance Exposure
Transactions conducted outside the electronic and Electronic Fiscal Device (EFD) system are vulnerable to scrutiny by TRA. Consequences may include loss of input VAT credits, additional tax assessments, and penalties under the Tax Administration Act.
4. Reputational and Commercial Risk
Businesses that fail to adopt electronic payment infrastructure risk reputational harm, loss of customer trust, and critically ineligibility for prioritized lending through government programs and financial institutions. The government has indicated that businesses adopting digital payment platforms will be given priority when applying for loans.
What Businesses Should Do Now: A Practical Compliance Checklist
The effective date has already passed. Businesses that have not yet taken action should treat compliance as urgent. The following steps provide a practical roadmap:
| 1 | Map Your Affected Transactions Identify which of your business activities fall within the specified sectors and transactions listed in GN 158C. Consider all revenue streams, not just the primary business. |
| 2 | Establish Compliant Payment Channels Set up or verify that you have operational electronic payment channels: bank transfers, TIPS-linked instant payments, mobile money (M-Pesa, Tigo Pesa, Airtel Money, etc.), and POS/card acceptance terminals. |
| 3 | Integrate Electronic Fiscal Devices Ensure your EFD/receipting system is integrated with your electronic payment channels and that all transactions generate proper electronic receipts and records. |
| 4 | Update Internal Policies and Contracts Revise sale agreements, lease agreements, vehicle-transfer procedures, and standard terms of business to require electronic settlement and to capture payment reference numbers. |
| 5 | Train Staff and Inform Counterparties Conduct training for finance teams, sales staff, and front-line personnel. Notify customers, tenants, and business partners of the new payment requirements. |
| 6 | Retain Proof of Electronic Payment For real estate and motor vehicle transactions, obtain and retain documentary proof of electronic payment before lodging transfer applications with the Ministry of Lands, TRA, or BRELA. |
| 7 | Seek Legal Advice for Complex Transactions For high-value, multi-party, or cross-border transactions, obtain legal advice on structuring payments to comply with the new requirements while managing commercial risks. |
Practical Examples
The following scenarios illustrate how the new requirements apply in everyday business situations:
Scenario 1: Buying or Selling a House or Plot
Juma wishes to purchase a residential plot in Dar es Salaam for TZS 150 million. Under the new law, the purchase price must be paid electronically whether by bank transfer, TIPS, or mobile money. When Juma and the seller lodge the transfer application with the Ministry of Lands, they must present proof of the electronic payment. If Juma paid in cash, the Ministry will not process the transfer, and Juma will not obtain legal title to the property.
Scenario 2: Buying or Selling a Used Vehicle
Amina is selling her used Toyota Land Cruiser for TZS 85 million. The buyer must pay Amina through an electronic channel bank transfer or mobile money. When the buyer applies to transfer vehicle registration, BRELA and TRA will require verification of the digital payment record. A cash transaction will not support the registration transfer.
Scenario 3: Retail and Service Businesses
A shopping mall operator, a gym owner, a cinema, or a fuel station must now offer and use electronic payment methods for all transactions with customers. Cash-only operations are no longer compliant. These businesses must invest in POS terminals, mobile payment acceptance, or other electronic payment infrastructure.
Scenario 4: Agricultural Cooperatives
A coffee AMCOS in Kilimanjaro collecting produce from member farmers and making payments must route all payments to farmers electronically. Similarly, payments received from buyers of the cooperative’s produce must be received through electronic channels.
Scenario 5: Schools and Universities
A private secondary school collecting annual tuition fees must receive all fee payments electronically. Parents and guardians should be informed that cash payments at the school’s finance office are no longer permissible under the new framework.
Looking Ahead
Tanzania’s mandatory electronic payment regime represents one of the most significant regulatory shifts affecting everyday commerce in recent memory. It touches virtually every business from multinational corporations to smallholder farmers selling through cooperatives, from luxury hotels to neighborhood fuel stations.
The transition will not be without challenges, particularly in areas with limited digital infrastructure or for populations less familiar with electronic payment systems. The Bank of Tanzania has emphasized that continuous public education will be critical for successful adoption. The broader policy context including the Tanzania Digital Economy Strategic Framework 2024–2034, the Jamii Namba system, and the phasing out of mobile phone recharge scratch cards in urban areas—signals that this is not a standalone measure but part of a comprehensive and irreversible digital transformation agenda.
For businesses, the message is clear: the time to act is now. Compliance is not optional, and the consequences of inaction are immediate and tangible.
How We Can Help
At Ernestilla, Mafita & Company Advocates, our Corporate, Real Estate, and Regulatory teams advise businesses across all sectors on compliance with Tanzania’s evolving financial and commercial laws. Whether you need assistance structuring a compliant real estate transaction, updating your standard contracts, advising on cross-border payment flows, or training your team on the new requirements, we are here to help.
Disclaimer: This article is published for general informational purposes only and does not constitute legal advice. The information contained herein should not be relied upon as a substitute for specific legal counsel. Readers are advised to seek professional legal advice tailored to their particular circumstances before taking any action based on the content of this article. Ernestilla, Mafita & Company Advocates accepts no liability for any loss arising from reliance on this publication.
