Kenya’s capital markets regulator CMA has disclosed that it granted Genghis Capital, a local based investment bank the green light to roll out a mobile phone-based collective investment scheme solution dubbed Mali in partnership with Safaricom, the country’s leading telco.
The Money Market Fund tool will allow MPesa users to invest any amount between KSh 100 and 70,000 for daily interest with a return of 10% interest annually, subject to withholding taxes. Mali will be accessible to both feature phone and smartphone users.
According to the regulator, Genghis Capital was granted approval in 2019 to test and roll out the mobile phone-based investment solution in partnership with Safaricom PLC.
Mali Sandbox Testing
“The firm initially requested to be admitted in the sandbox for a period of 3 months but subsequently requested for an extension of this period with the aim to ensure wider reach of customers The firm completed running the tests and exited the sandbox and was authorized to roll out the product on a commercial scale.” CMA notes.
“Following the successful completion of the testing process, the Authority wrote a letter of “No Objection” to Genghis to proceed to launch the Product to the public on December 31st, 2019. The Authority also approved the amendment of the incorporation documents of the underlying fund to make it a stand-alone fund as opposed to being under an umbrella-like it was before, in preparation for the operationalization. This was to create independence and separate it from the other funds.” The CMA disclosed in its regulatory Sandbox Report launched recently.
Safaricom Plc disclosed in December that it was looking for partnerships with fund managers and investment banks as it seeks to become a fully-fledged financial services provider.
“Safaricom Plc is in negotiations with fund managers, investment banks and insurance companies to partner on a raft of mobile phone-based savings and wealth-management products,” said Peter Ndegwa, Safaricom’s CEO, in December 2020.
He mentioned that the telco would seek approval from the Central Bank of Kenya (CBK) for the products over the next 1-1/2 years.
Genghis Capital is a participant of the Nairobi Securities Exchange (NSE) and provides stock brokerage solutions as well as asset management services. The firm, initially owned by collapsed Chase Bank, was acquired by Overtime Capital Limited a special purpose vehicle that was established by investors led by Pamoja Capital Limited.