Kenya launches world's first bond sale via mobile phone

Oct 06, 2015

The Ks5 billion (€42.5 million) bond is based on Kenya's M-Pesa mobile money platform.

The world’s first Treasury bond to be offered exclusively via mobile phone was launched last week by the Kenyan government.

The Ks5 billion (€42.5 million) five-year 'M-Akiba' infrastructure bond is based on Kenya’s M-Pesa mobile money platform, which counts more than 20 million users.

The government has slashed the minimum investment level in government debt, with Kenyans now able to buy the bond in increments as small as Ks3,000 and trade it on the secondary market from anywhere.

It said the objective of the M-Akiba bond is to boost public savings and participation in the capital markets.

"This historical development is testament of our commitment to embrace innovation to democratise the uptake of government securities," National Treasury Cabinet Secretary Henry Rotich said in a statement.

"Over the years, 98 per cent uptake in government bonds has been by institutional investors, with only two percent going to individual investors- and this has left out many Kenyans from participating in raising funds for nation building," he added.

Stephen Chege, director of corporate affairs at telecom company Safaricom stressed the need to enhance the savings culture among Kenyans adding that currently, only 11 per cent of Kenyans save on a regular basis as compared to 22 per cent in Rwanda and Uganda.

The bond comes after a trading service via mobile phone was launched last month in Tanzania. It allows investors to carry out transactions on the country's stock market via a mobile application.

The service is offered by the company Maxcom Africa, a provider of payment solutions in Tanzania.ADNFCR-2976-ID-801802359-ADNFCR