Safaricom has received approval from the Capital Markets Authority (CMA) to establish its Money Market Fund, named Ziidi.
In a statement released on November 27, the CMA announced that it has granted Safaricom PLC permission to set up the Ziidi Money Market Fund as a Collective Investment Scheme (CIS).
“This move represents a significant step forward in innovation for the company,” CMA announced.
According to the Authority, the fund will be accessible through the M-PESA platform, making it convenient for subscribers to grow wealth through the capital markets.
Safaricom gets approval to start its own Money Market Fund
This investment scheme, developed by Safaricom, is a collaboration with three fund managers: Standard Investment Bank, ALA Capital Limited, and Sanlam Investments East Africa Limited.
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Wyckliffe Shamiah, the Chief Executive Officer of the Capital Markets Authority (CMA), stated that this milestone highlights the commitment to fostering innovation, enabling Safaricom to expand its presence in the financial services sector.
Additionally, the Authority noted that the Ziidi Money Market Fund aims to empower unit holders by providing accessible and diversified investment options as part of the broader National Government’s financial inclusion strategy.
Background Information about CMA
The Capital Markets Authority (CMA) was set up in 1989 as a statutory agency under the Capital Markets Act Cap 485A.
It is charged with the prime responsibility of both regulating and developing an orderly, fair, and efficient capital markets in Kenya with the view to promoting market integrity and investor confidence.
The CMA also regulates commodity markets and online forex trading. Its regulatory functions, as specified by the Act and associated regulations, include the following:
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– Licensing and supervising all capital market intermediaries.
– Ensuring that all market participants comply with the legal and regulatory framework.
– Regulating public offerings of securities, including equities and bonds, as well as the issuance of other capital market products like collective investment schemes.
– Promoting market development through research on new products and services.
– Reviewing the legal framework to adapt to market dynamics.
– Promoting investor education and public awareness.
– Protecting investors’ interests.
About money market fund
A money market fund is a mutual fund that invests in high-quality, short-term debt instruments, cash, and cash equivalents. These funds are designed to provide investors with high liquidity and a very low level of risk.
Some of its key characteristics include:
- High Liquidity: Money market funds allow investors to quickly and easily access their funds, making them highly liquid investments.
- Low Risk: They invest in short-term, high-credit-quality debt securities, which minimizes the risk of default.
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