State to regularly tap M-Akiba to raise funds

National Treasury Public Debt Management Office Director-General Wohoro Ndoho rings the bell at the Nairobi Securities Exchange (NSE) to launch the listing of M-Akiba bond yesterday. With him are NSE Chief Executive Geoffrey Odundo (left) and his Central Depository Settlement Corporation counterpart Rose Mambo. [Jonah Onyango, Standard]

Ordinary Kenyans will be relied on from time to time to raise infrastructure capital through the mobile phone-based M-Akiba bond.

National Treasury Director-General Public Debt Management Wohoro Ndoho said the recently floated Government bond will not be a one-off affair as its limited offer began trading on the bourse yesterday.

“We don’t envisage this as a one-off. This is going to be a permanent part of our financial sector infrastructure to ensure that an average Kenyan gets to participate as fully as any other large institution,” said Mr Ndoho.

Since 2000, NSE has helped the Government raise Sh1 trillion. Making M-Akiba a permanent deal to tap from a new pool of small investors with a basic phone and at least Sh3,000 will increase ease and amount raised on the bourse.

The bourse has 54 Government bonds as of June 2016 but largely commanded by institutional investors.

Speaking yesterday at the Nairobi Securities Exchange (NSE) during the bell-ringing ceremony for secondary listing of Sh150 million M-Akiba bond, Mr Ndoho said the bond will help deepen public-private partnerships.

The bond, which saw 5,692 Kenyans subscribe for the bond five days ahead of closure date, opened trading on the secondary market yesterday. This is to give more Kenyans a chance to buy and sell through brokers.

Commercial Bank of Africa (CBA) has been handed the role of the market maker. This means that it will provide Sh150 million as liquidity to ensure seamless entry and exit for investors for the three-year period of the bond as they trade on the NSE.

During the launch of the bond at National Treasury on March 23, National Treasury had named Kenya Commercial Bank as the underwriter. However, yesterday Mr Ndoho said the switch to CBA was to meet deadline.