Telco giant Safaricom PLC has entered the money market fund after its subsidiary, Ziidi Money Market Fund, received a license from the Capital Markets Authority (CMA).
- •CMA has licensed Ziidi MMF as a Collective Investment Scheme (CIS).
- •It will be accessible through the MPESA-platform similar to the other Safaricom-backed Unit Trust Mali managed by Genghis Capital.
- •The product is a partnership by Safaricom with Standard Investment Bank, ALA Capital Limited, and Sanlam Investments East Africa Limited.
According to Wycliffe Shamiah, CMA’s CEO, the new development “underscores the commitment to foster innovation which also enables Safaricom enhance its footprint in the finance services sector.”
A money market fund is a mutual fund that invests in cash and low-risk, short-term debt securities. The fund manager allocates pooled funds from investors to different asset classes.
Money market funds were originally introduced in the 1970s to offer more competitive rates than the banks whose rates are mainly tied to the Central bank rates.
Money Market Funds (MMFs) remain the most popular vehicle, accounting for KSh 171.2 billion – 67.4 percent of all Collective Investment Schemes (CIS), under management. The other funds took up the remaining 32.6 percent share – Fixed Income Fund (52.1 billion), Equity Fund (2.6 billion), Balanced Fund (1.4 billion), Other Funds (26.8 billion) for the year ended June 2024. Read More.