NAIROBI, Kenya, Jun 30 – A journey of a thousand miles begins with one step, and for M-Akiba, the official step has just started.
The bond, which is the world’s first mobile traded bond, has been launched, after its pilot phase was launched in March and was over-subscribed in just 8 days.
Issued by the National Treasury, the bond has set out to raise Sh1billion, with a green shoe of Sh3.85 billion.
The three year tenure will see investors get a 10 per cent coupon per year, payable every six months.
Sam Kimani the Chairman of the Nairobi Securities Exchange says the bond comes at an opportune time when Kenyans have their sights set on innovative products.
“Kenyans finally have an opportunity of engaging with the Retail bond market, which has for a long time been dominated by foreigners. And we can confirm that they are interested in it seeing that target of the special limited offer bond was met just 8 days after it was launched,” Kimani said.
The bond was first introduced to Kenyans in March this year when Treasury offered a limited bond of Sh150 million with the intent of raising money internally to fund infrastructure projects.
– Vehicle to save –
National Treasury Cabinet Secretary Henry Rotich, while launching the bond, invited Kenyans to buy the bond as a means of saving.
“As it is, Kenyans have a low saving culture. This bond is meant to turn this around, especially because there is the interest rates offered to entice them.”
Investors of the tax exempted bond will only need an initial amount of Sh3,000 and thereafter multiples of Sh500.
The maximum a person can invest has been raised from the Sh140,000 requested in the special bond to Sh999,999.
“Apart from mobile money, Kenyans will also be paid through the newly launched Pesalink. Payments will be made every six months beginning January 22, 2018.
The NSE listed bond is open to Kenyan citizens registered on Airtel or Safaricom mobile network operators.
Interested participants need only to dial *889# to subscribe. Redemption of the bond will be on July 20, 2020.