Treasury to float Sh5 billion targeting ordinary KenyansMonday September 28 2015
Treasury will float a Sh5 billion bond on October 16, which will only be traded on mobile phone platforms targeting ordinary Kenyans.
The five year infrastructure bond will go to the market at a rate to be set by the National Treasury and the Central Bank of Kenya.
Individuals can bid with as little as Sh3,000 and a maximum of Sh140,000 for the income tax free bond.
“We set the maximum at Sh140,000 because that is the much mobile phone companies are allowed by Central Bank but you can put in the figure daily until the auction closes,” Central Depository Settlement Corporation CEO Rose Mambo said.
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The product will only be available to Kenyans who currently make up two per cent of the Nairobi Securities Exchange (NSE) Bond market portfolio.
The mobile platform will see over 23 million Kenyans potentially participate in the bond. Individuals will also enjoy instantaneous purchase of Government bonds as opposed to the previous two day process.
To invest in the new automated system called ‘Save Money, Make Money, Build Kenya” bond, potential customers will only need to have a valid ID, dial *889# and follow the prompts.
M-Akiba is yet another innovative application that will help more people save and invest, while making it faster for the government to raise funds.
There is genuine need to enhance the savings culture among Kenyans.
Currently, only 11 per cent of Kenyans save on a regular basis as compared to 22 per cent in Rwanda and Uganda, while in Qatar this figure stands at 60 per cent,” said Safaricom corporate affairs director Stephen Chege.
“Our bond market is currently dominated by foreign and local institutional investors, M-Akiba is in line with NSE’s strategy of enhancing financial inclusion by driving retail investor participation,” NSE chairman Eddy Njoroge said during the launch of the marketing campaign in Kenyatta International Convention Centre Monday.
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