M-Akiba bond app is a Government-of-Kenya-issued retail bond that seeks to enhance financial inclusion for economic development. Money raised from the issuance of M-Akiba shall be dedicated to infrastructural development projects, both new and on-going.
What is M-Akiba
M-Akiba is a unique opportunity for Kenyans to save money, while at the same time earning very attractive interest rates from the Government.
M-Akiba is a retail infrastructure bond issued by the Government of Kenya to Kenyans that seeks to enhance financial inclusion for economic development.
The following are the stakeholders who facilitate buying and selling of government bonds through M-Akiba:
- Central Bank of Kenya (CBK)
- The National Treasury
- Nairobi Securities Exchange (NSE)
- Central Depository Settlement Corporation (CDSC)
- Mobile Network Operators
- The Kenya Association of Stock Brokers & Investment Banks (KASIB).
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The money raised from the bond will be used for funding of government infrastructural development projects, both new and on-going.
Further, the M-Akiba bond app is also aimed at enhancing the savings and investment culture by Kenyans.
Kenyan savings are at 11% of GDP while countries like Qatar are at 60%, while Rwanda and Uganda are at 22% each.
Purpose of M-Akiba bond app
The purpose of floating the M-Akiba bond app is to finance Government development expenditure or budgetary support. Tenure of the bond is 3 years with a target of Kshs. 150 million.
M-Akiba bond app Platform
The M-Akiba platform is a Mobile Traded Bond hence all activities relating to registration, trading, and settlement will be via the mobile platform.
You can access the M-Akiba services by dialing USSD code *889#. Maximum investment per account / per day is Kshs. 140,000.
How do government bonds work?
In the simplest terms, a bond is a loan that you give to the government to aid its budgeting needs or development needs.
Bonds have a maturation date and ones the bond matures, you get your principal investment plus your interest or profit.
When you buy a government bond, therefore, you lend the government an agreed amount of money and get some interest as your profit at regular periods of the year.
When the bond expires, you usually get back your original investment. The date of maturity is when the company must pay back the principal or initial investment to the lender.
It is important to know that different kinds of bonds come with different kinds of maturity dates. You should, therefore, take note of that before making any major investment on bonds.
Minimum M-Akiba Investment
Initial minimum investment amount per account is Kshs. 3,000. The M-Akiba bond is guaranteed by the Government of Kenya.
How do I get paid?
The coupon shall be paid directly to the phone automatically on the maturity dates. This will be the case even in instances where the coupon to be paid exceeds the Kshs. 140,000 daily limit.
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The M-Akiba bond is tax-free. The interest rate of the bond is 10% per annum but will be payable semi-annually after every 6 months.
How to invest with M-Akiba bond app
The following is a step by step process showing you how to invest in the M-Akiba government bonds. Follow the pictures or read the steps below
- To invest in M-Akiba, dial USSD Code *889# on your phone
- A prompt will appear on your screen requiring you to enter your preferred Personal Identification Number (PIN). Set your preferred PIN then press OK to proceed. Please note that for subsequent transactions, you will use the preferred PIN you entered the first time.
- You are advised to keep your PIN a secret and protect it against unauthorized persons. In the event, you forgot your PIN, press 0 and follow the prompts to set a new PIN.
- Enter Your National Identity Number: The M-Akiba bond app is open to Kenya’s citizens who have attained legal adult age of 18 years and are in possession of mobile money enabled phone, a duly registered line, and a valid National Identity card.
- Register to Participate in M-Akiba: After entering your National ID number, you will then be prompted to register by dialing 1.
- Terms & Conditions of M-Akiba: The service will revert with terms & conditions of M-Akiba. You are required to read and understand the terms & conditions. If you are in agreement press 1 for YES.
- Successful Submission of Details: After accepting terms & conditions, you will receive notification from your network service provider informing you of your successful submission of details. You will then wait a few minutes for a confirmation message.
- M-Akiba Account Details: The confirmation message will have your M-Akiba Account Number, Your Name and the activation time & date of your M-Akiba Account. To continue trading, dial *889# on your line and follow the prompts.
Advantages of buying government bonds
- Upon maturity, investors receive their interest payments and a return of their initial investment
- Government bonds have steady interest income compared to stocks
- Some bonds are free from state and local taxes
- Government Bonds are said to be a low-risk investment compared to stocks or forex
- It is easy to buy and sell government bonds in the stocks markets as well as mutual funds