Government’s M-Akiba Veers Off The Target Again

Once again, government’s M-Akiba has failed to hit the set target, raising issues over inadequate information about it to the public.

During the third re-opening, the government, through the National Treasury, moved the expected returns from 250 million shillings to 500 million shillings.

The mobile-traded government bond veered off the target almost by half to fetch 263 million shillings.

The government has been trying to popularize the M-AKIBA bond among the Kenyan youth with the aim of bringing the majority of them on board.

Many of those we spoke to have attributed lack for adequate awareness about M-AKIBA especially on the duration of investment and the returns.

The government bond allows both large and small-scale investors to purchase bonds with as little as 3,000 shillings with a return of 10 percent annually.

The failure by the bond to meet the target followed the recent revision by the Nairobi Securities Exchange from the initial 250 million shillings to 500 million shillings, a combination of July and September issues.

The government hopes to use funds from the M-Akiba bond to help in the financing of the infrastructural projects with the three consecutive misses hitting it hard.

The government’s target for the M-AKIBA subscription in the medium term was at 4 billion shillings. The overall subscription since the rollout of the first bond crossed the 1 billion mark with the third issue.

According to records by the NSE, the bond has attracted new more than 51,461 new accounts between the month of August 19th and September 6th, 2019. Given the number of millions of Kenyan youth, the number is still meager.

Investors in the bond get paid their interests semi-annually. Currently, the interest paid has gone up to 98.6 million shillings.

“M-AKIBA is a good investment, especially for young people. However, the NSE should strive to debunk the notion that it is only for the elites. Anyone can invest,” said Ernest Ouma, an investor with M-AKIBA.

Read Also: M-Akiba Misses Out on the Ksh. 250 Million Target Once Again