NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, March 22, 2017

Kenyan citizens will soon be able to buy government bonds on their cell phones. Kenya’s Treasury said today that the M-Akiba bond, the world’s first mobile-only government bond, would go on sale on Thursday after a delay of almost two years.

Kenya first announced plans for the bond, named after the Kiswahili word akiba or “savings,” in late 2015, as a way to give ordinary Kenyans access to the country’s capital markets. Investors can buy in increments as small as 3,000 shillings (about $30), compared to the minimum of 50,000 shillings individuals had spend to spend previously to buy government bonds.

“This product is for a mama mboga, farmer, employee, hustler or whatever,” the Treasury said in a press release at the time, referring to women that sell vegetables at small market stalls. A month after the announcement, M-Akiba was delayed over clearance issues.

Now, the bond will be offered on M-Pesa, Africa’s biggest mobile money network that got its start in Kenya, as well as other mobile money networks. Investors can buy and sell the bonds on the Nairobi Securities Exchange via their phones. Coupon payments will be paid directly to their phones. Like M-Pesa, both smart phones and basic features phones can be used.