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President William Ruto yesterday made a case for the “Hustlers” to invest in government securities by asking the National Treasury to lower the threshold for T-bills and bonds to Sh5,000.

He said there was a need to expand the scope of participants and make it possible for more local and Kenyan investors from both within the country and the international investors to participate in this process.

Ruto was speaking at the Central Bank of Kenya (CBK) during the launch of the Dhow CDS.

The Dhow Central Depository Securities (CDS) is a new portal by CBK that allows Kenyans to trade in government bonds and Treasury Bills through a mobile App. 

Currently, to invest in Treasury Bills and Bonds, one must have a Kenyan bank account, and invest a minimum of Sh100,000 to purchase T-bills, or Sh50,000 for the regular bond while an infrastructure bond would fetch Sh100,000 on the lower side. 

“There is a case that I want to make for the people who do not want to necessarily work on Sh50,000 and I am making a case for what we wanted to do with M-Akiba before. The M-Akiba did not go far because it had many challenges. I am persuaded that it is possible for us to reduce the denomination and I want the team to work on what is this denomination that can democratise that space,” Ruto said.

“Because there is no requirement for people to travel to Nairobi and they can transact on their phones, there is absolutely no reason why you cannot facilitate that person to have a transaction of Sh5,000,” the head of state added. The DhowCSD offers an online platform for investors to open bond trading accounts, place bids for their preferred securities during auctions, and conveniently manage their bond investments. By deepening the market and improving transparency, the platform aims to lower the government’s cost of borrowing and tap into a wider pool of funds.

Bank accounts

Ruto further urged the National Treasury to consider accepting M-Pesa or Credit Cards to accommodate many Kenyans locally and abroad without Kenyan bank accounts to enable them purchase government securities.

Currently, investors require Kenyan bank accounts to purchase T-Bills and Bonds. A minimum of Sh100,000 is required to purchase T-bills. Regular bonds fetch Sh50,000 while the price for an infrastructure bond is Sh100,000.

CBK Governor Kamau Thugge said since the DhowCSD went live on July 31, 2023, more than 7,000 new accounts have been created, compared to the total of 44,000 that existed prior to launch. “DhowCSD is transforming Kenya’s financial markets through enhanced operational efficiency and expansion of digital access, market deepening for broader financial inclusion, and improved monetary policy operations,” Thugge said.

Ruto said the new system will deliver convenience, efficiency and speed, without compromising security, adding that the innovative improvements have brought the benefits of transparency and accountability for the government just by automating the auction of Treasury bills and bonds.

“With this innovation, investors no longer need to physically visit CBK’s head or branch offices to undergo the manual process of opening a CSD account, which previously took 14 days and involved laborious manual trading,” Ruto said.