Gov’t to launch M-Akiba bond before end of year

By Carol Njenga/Agencies

The world’s first purely mobile phone based government security dubbed M-Akiba would be rolled out before the end of this year.

Central Depository and Settlement Corporation CEO Rose Mambo says necessary infrastructure to ensure a smooth clearing and settlement is up and running.

The platform will enable Kenyans to invest as little as 3000 shillings in government securities.

For long, trading in Government Bonds in Kenya has been the reserve of the wealthy and influential; which is only a handful of people compared to the entire population. Meaning the domestic money markets was only a rich men playing ground and the poor could only watch from afar if at all they were aware of its existence and how they could potentially gain by also trading.

The Government has lowered the premiums from Ksh.50,000. The maximum an individual can trade in a day is Ksh.140,000 per day. This move is expected to increase the uptake of government securities by more citizens across the country.

Last year President Uhuru Kenyatta signed a law to guide the National Treasury on the sale of the 5 billion shillings mini securities targeting the common man.

The M-Akiba bond has been delayed due to volatile interest rates. The system needed to facilitate the government to sell the mobile phone based bond is up and running.

Under M-Akiba, anyone with as little as 3,000 shillings will be able to invest in the bond from the comfort of their homes or offices.

This emerged as Central Depository and Settlement Corporation, relaunched with the promise to introduce a system in April next year that will increase product offering.

The system will increase CDSC’s capacity on the number of products and transactions they can handle in different markets.

Currently, CDSC handles up to 30,000 transactions daily.

CDSC is leveraging on technology to build a robust system that will mitigate risks and allow investors to trade shares across Africa using the existing infrastructure within the country.