The government has reopened the M-Akiba bond targeting to raise 250 million shillings from Monday 25th February till 8th March 2019.
To counter under subscription witnessed in the last issuance, the government has put in place a multi sectoral agency comprising of among others the Capital Markets Authority, Nairobi securities exchange as well as the Central Depository and Settlement Corporation to spearhead financial literacy and marketing campaigns in the public domain to spur uptake.
Breaking…
M-Akiba Re-Open Launch happening today at CDSC offices.
CDSC CE, Ms.Rose Mambo and NSE CE, Mr. Jeff Odundo testing the primary offer platform. pic.twitter.com/OX2YerN2xW— CDSC Kenya (@cdsckenya) February 25, 2019
M-Akiba was officially launched in March 2017 on a special offer aimed at testing the markets appetite that ended up raising 150 million shillings in a fortnight.
However in its second issue in June against a target of 1 billion shillings the June offer was under subscribed raising only 247 million shillings.
In its report Financial Sector Deepening – FSD Kenya, noted that key players in the issuance of the bond did not address the recommendations for the unbanked segment such as the preference for small denominations in purchasing the government security and maturity tenure in months not years.
In efforts to remedy this, the government will embark on a series of marketing and financial literacy programs to boost uptake of the bond.
The three year bond with one and half years to maturity aims to raise 4.6 billion shillings having already raised 397 million in the past offers.
The minimum investment is valued at three thousand shillings for mobile network operators and up to 1 million shillings on Pesalink.
Investment in the M-Akiba infrastructural bond has been termed as one to spur financial inclusion and savings culture among Kenyans.
The bond attracts a 10% interest as well as a commission rate of 0.1% of actual allocations for trading partners.
Interest will be paid out at 5% every six month each year. Stakeholders are optimistic that this offer will witness an over subscription and have hinted at four more tranches for the 5 billion note in future informed by performance of the latter.
The bond will be traded on the Nairobi bourse via mobile phones on Tuesday 12th March 2019.