Treasury now woos chamas to buy M-Akiba bonds

National Treasury Cabinet Secretary Henry Rotich rings the bell to launch the second issue of the M-Akiba bond last week. [File, Standard]

 

National Treasury Cabinet Secretary Henry Rotich rings the bell to launch the second issue of the M-Akiba bond last week. [File, Standard]

The National Treasury has lined up goodies to woo investors to put their money into the Sh3,000 mobile-based M-Akiba bond even as the second issue got off to a low start.

Sale of the issue, dubbed Mwananchi bond, has been rather quiet, with investors only picking up Sh12.39 million in subscriptions by the end of yesterday’s trading.

There has, however, been a marked interest in the bond compared to the last issue, with 122,032 investors having so far registered, although most of them have not paid up yet.

Treasury will need higher bids to net its Sh1 billion target, with a Sh3.8 billion green shoe, which means the Government will pick up any additional money above that figure.

National Treasury Director General, Public Debt Management Wahoro Ndorro, however, said yesterday the Government missed an opportunity to involve chamas (informal savings groups), which were expected to increase uptake.

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Mr Ndorro said that the next issue will involve the chamas as part of the incentives and improvements that will be rolled out every time the bond is issued.

“We had enlisted the help of the Kenya Association of Stockbrokers and Investment Banks to mobilise chamas, but the way M-Akiba is structured, it can only register an individual,” he said.

“This will, however, be improved as we launch the next one.”

Initially, the affordable mobile-based bond only traded on M-Pesa and Airtel Money, which were used by investors to purchase the maiden Sh150 million bond launched in March this year.

Treasury had hoped that enlisting Pesalink – which allows customers to make real time money transfers to other banks – would allow banks to bridge the limit of the bond, thus attracting higher value transactions.

However, only three banks have so far taken up the offer, with the rest still adjusting and testing their systems.

“What we looked at was whether their systems were stable and whether they were willing,” said Mr Ndorro. 

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