On Friday the Treasury Cabinet Secretary launched the second tranche of M-Akiba, the government bonds that can be bought and traded via mobile phone.
The first tranche of M-Akiba, worth Kshs 150 million was launched in March 2017, and marked at 10%, maturing in April 2020. They had their highest trading day on May 12 when about Kshs 345,000 was traded; usually, about Kshs 100,000 per day ($1,000) of M-Akiba are traded by investors so far. At the time of launch, the indication was that another Kshs 4.85 billion was to be raised in June 2017.
The new M-Akiba infrastructure bond issue (MAB2/2017/3) is targeting Kshs 1 billion (~$9.7 million), with a green shoe option to raise another Kshs 3.85 billion. These are also three-year infrastructure bonds (dated 24 July), paying 10% per annum, with interest paid every six months, and the minimum investment is, again, Kshs 3,000 (~$29). Payments for the new bonds will be done on mobile money such as M-pesa (by dialing *889#) as well as through Pesalink – a new service from Kenya banks that allows their customers to make payments via phone and mobile money transfers of up to Kshs 1 million (~$9,700) per day – which is seven times greater than what they can do with mobile money, under current banking rules (set to prevent money-laundering). The deadline for investors to apply for the M-Akiba bond is July 21, and the trading commission for will be 0.1% of allocations.
EDIT (July 23 Nation): MAB2/2017/3 has been extended to 8th September and the bond will start trading on 12th September. It has been reported that investors bought Kshs 128 million before the initial deadline, and the newspaper notice of the extension mentions that these invests will be paid for interest earned between July 24 and 11th September.
‘Akiba’ means ‘savings’ in Swahili.
$1 = Ksh 103
Today saw the launch of M-Akiba, a long awaited product that through which ordinary Kenyans tcan buy government bonds on their phones, using mobile money. The can purchase units as small as Kshs 3,000 (~$30) and earn 10%.
Some tweets about the events today:
- The Central Bank of Kenya governor (@njorogep) said #MAkiba bond is in line with @CBKKenya strategy to increase the level of financial inclusivity in the economy – @NSEKenya
- #MAkiba is a collaborative initiative between @NSEKenya @KeTreasury @cdsckenya @SafaricomLtd @AIRTEL_KE @KCBGroup – @NSEKenya
- Phase One of M-Akiba Runs for 3 weeks targeting Sh150M. Main offer targeting Sh4.85Bn in Q2-Q3 Will run for 3 Months – @kenyanwalstreet
- M-Akiba bond has so far been Ksh. 535k purchased. I am surprised Kenyans were this interested. So far highest buy is at Ksh. 50k – @MumbiWarui
- Day One Of M-Akiba; Bonds worth Ksh 1.0 Million Bought Via Mobile Phones In the first 60 Minutes http://kenyanwallstreet.com/m-akiba-retail-bond-goes-live … @kenyanwalstreet
- To trade #MAkiba bond open a CDS account by dialling *889# either on @SafaricomLtd @AIRTEL_KE .The initial investment per account is 3,000. – @NSEKenya
- CDSC to manage the register of the bond, offer IPO managements system and the depository and settlement services on behalf of the government – @cdsckenya
- We have just witnessed the launch of the first M-Akiba bond at the Treasury. It has a coupon rate of 10%p.a.Tradable through the phone.- @JimnahMbaru
- The #MAkiba bond entry level is kshs 3,000 compared to the current entry point of Ksh 50,000 for any govt securities. @M_AKIBA2017 – @NSEKenya
- #MAkiba bond is a tax free bond that will attract a 10% interest paid biannually within a period of 3 years @CMAKenya @cdsckenya @CBKKenya – @M_AKIBA2017
- We are receiving A LOT of transactions per sec. In case of any delays, please just try again. Thank you for the overwhelming response so far – @M_AKIBA2017
- UPDATE: Subscription figures- @AIRTEL_KE Airtel Money -1,300 @SafaricomLtd MPESA-420 Total collection KES 2.4 million. AS AT 4PM TODAY – @M_AKIBA2017
- M-Akiba is a three year fixed coupon infrastructure “special limited offer” bond
- Issue number MAB1/2017/3
- Amount Kshs 150 million (~$1.5 million) issued in March 2017
- Apply by *889#, and runs from 23 March to 7 April and will be allocated on a first come first served basis
- Minimum investment is Kshs 3,000, maximum investment is Kshs 140,000 (~$1,400) per day
- Coupon 10% a year
- Bond will be listed on the NSE and will be tradable by phone from April 11
- Trading commission is 0.1% of actual allocations
- M-akiba interest is tax exempt
- Pays interest every 6 months: on (2017) 9 Oct, (2018) 9 April, 8 Oct., (2019), 8 April, 7 Oct., (2020) 6 April
- From a prospectus in a local newspaper.
‘Akiba’ means ‘savings’ in Swahili
$1 = Ksh 103