Kenya launches world’s first mobile-only government savings bond

Kenya has launched the world’s first ever mobile only government bond, allowing the average Kenyans to purchase government bonds on their mobile phone as the East African country seeks to tap into the booming mobile money market.

The $50 million bond dubbed M- Akiba, Swahili for, Mobile savings bond is to be sold at minimum denominations of $30 through the mobile money platforms.

Investors can buy and sell the bonds on the Nairobi Securities Exchange via their phones. Coupon payments will be paid directly to their phones. Like with M-Pesa, both smartphones and basic features phones can be used.

“This product named after the Kiswahili word, akiba or “savings,” is for a mama mboga, meaning an average Kenyan including a farmer, employee, hustler or whatever,” the treasury said in a press release, at the time referring to women that sell vegetables at small market stalls.

By 4pm on the opening day of the bonds, a total of $23,000 had been collected from 1,720 investors.

Such was the demand that system temporarily crashed as stakeholders moved to tweak the system to handle the demand.

“There has been an overwhelming demand for M-Akiba bond, the traffic for registration and purchase was beyond what had been expected. Due to the overwhelming response, any delays in subscription is currently being rectified to accommodate the high number of investors,” M-Akiba said on its official twitter handle.

Investors can buy up to $1400 of the bond per day, as that is the transaction limit set for mobile money transfer services.

The tax free M-Akiba bond attracts a 10 percent interest paid to investors over its three year tenor.

The platform will also rapidly increase transaction time, with trades that previously took an average of two days made instantly via mobile. Individual retail investors previously only accounted for 2 percent of government bond uptake, with the remaining 98 percent bought up by institutional investors.

www.treasury.go.ke

Share this PostFacebooktwittergoogle_pluspinterestlinkedinmail
Connect with UsFacebooktwittergoogle_pluspinterestlinkedin

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Send in Your Business News to BusinessTrumpet News!