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Investing Through The Mobile Platform

Investing Through The Mobile Platform









In recent investment news, the Treasury’s mobile based bond, M-Akiba, that was reopened mid last month has raised 263 million Kenya Shillings during this third issue, falling short of the targeted Kshs 500 million. Interestingly, two thirds of investors on the M-Akiba government bond platform are taking up values worth less than Kshs 20,000, indicating the large number of Kenyans who were previously locked out of similar investments by prohibitive entry barriers. The M-Akiba infrastructure bond at an annual interest rate of 10% has its minimum subscription set at Kshs 3,000, specifically meant to make it accessible to the masses, unlike normal Treasury bonds that have a minimum subscription amount of Kshs 50, 000, and infrastructure bonds at a minimum amount of Kshs 100,000. This is the third issue of the M-Akiba Bond. The uptake has overall (combining all three issues) crossed the Kshs 1 billion mark. M-Akiba is set for a fourth-reopening in October 2019 as the Kenyan government continues to leverage on this innovative capital market instrument to raise domestic debt.

Kenya has been ranked the second most prominent innovation hub in sub-Saharan Africa (trailing South Africa) by the World Intellectual Property Organization in its latest Global Innovation Index 2019 report. According to the Central Bank of Kenya, the value of mobile money payments rose by 11.1 percent to hit Kshs 2.5 trillion in the first seven months of this year. The masses appetite for digital loans has led to many unregulated microlenders to occupy Kenya’s credit market. Many Kenyans who had little or no access to credit can get loans in minutes through their mobile phones. The increase of the digital lenders extending credit to the individuals (those banked or not) are burdening borrowers with high interest rates however the banking regulators are working towards keeping up with these activities. In line with the news regarding technology and finance, small/medium sized enterprises (SMEs) using technology to provide solutions to address and counter local problems are going to have access to funds and professional assistance from the European Commission (EC) which will enable the SMEs to expand their operations and prosper. The European Commission will facilitate establishment of an Africa-Europe Innovation Partnership (AEIP) and the EC have set up a Kshs 286 million fund for this purpose. We look forward to such partnerships facilitating the generation of new businesses and employment.

We are nearing the month of October and it is a good time to plan investments for the last three months of the year. For those prudent readers who have invested in shares of companies listed on the NSE, interim dividend payouts are ongoing which continue till November. The Nairobi Securities Exchange Shares index is not gaining much momentum however it is an appropriate time to purchase at the current low prices high yield shares of various blue chip companies. It is a good time to purchase banking stocks. In recent news, as per Central Bank of Kenya data, commercial banks have raked in close to Kshs 85 billion half year profits in the 6 months (January – June 2019) thereby defying the punitive economic environment.

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