Sold out; how Kenyans bought $1.5 million worth government bond in a record 13 days, lessons for the rest of the world

It is no secret that with the big success of Kenya’s first financial technology M-Akiba, other countries will now be more embolden to try to replicate the same feat.

Kenyans from all walks of life raced against time to buy shares in $1.5 million (Sh150 million) worth M-Akiba bond, the first mobile-only traded government bond in the world.

“This product is for a mama mboga, farmer, employee,hustler or whatever” the treasury said at the time of the launch.

Within 2 days of the launch Kenyans had already bought $24,000 (Sh2.4million) worth shares and by April 4 $1.53million (Sh135 million) worth of the bond against a target of $1.50 million.

Kenya first announced plans for the bond, named after the Kiswahili word akiba or saving in late 2015 but kept postponing the launch due to unforeseen circumstances until March 23 2017.

Kenyans overwhelmingly registered and bought M-Akiba bond for three reasons first the 10% return was guaranteed no matter how small the amount one invested and the principal was also not at risk compared to form of investments.

Secondly, the simplicity of the whole process of trading in M- Akiba was also a plus; any Kenyan who owned a mobile phone and had a minimum of $30 was free to partake in the historic bond. This compared to the minimum of $500 individuals had to spend previously to buy government bonds was a game changer.

In addition, contrary to popular belief, one did not need to have a smart phone to register and trade in M-Akiba. The inter-phase has been designed such that a simple ordinary phone with limited screen display such as ‘mulika mwizi’ works just fine.

Thirdly M-Akiba was a fool-proof way Kenyans could save their hard earned cash and sleep soundly at night without worrying about market fluctuations.

Some 102,632 people registered on their phones to invest in the bond, but only 5,692 of those made actual purchases, ranging from the minimum 3,000 shillings up to 1 million shillings – the maximum bought by a single investor, the Finance Ministry said.

It is no secret that with the big success of Kenya’s first financial technology M-Akiba, other countries will now be more embolden to try to replicate the same feat, the good news for Kenya though, just like in Mpesa case it has cemented its place again as one of the most innovative countries in the 21 century.

For guys who did not participate in the historic M-Akiba bond, they sadly have to wait until June when a bigger bond targeting to raise Sh4.85 billion will be opened by President Uhuru Kenyatta.

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