The Capital Markets Authority (CMA) has approved the registration of the Ziidi Shariah Money Market Fund (MMF) a month after telecommunications giant Safaricom launched the Ziidi MMF.
CMA in a statement on February 20 confirmed that it has approved Gulfcap Investment Bank to register the Ziidi Shariah MMF.
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The fund is a Shariah-compliant investment product designed to cater to the growing demand for Islamic finance in Kenya and will operate as a standalone fund with its distinct incorporation documents and promoter.
According to CMA, Ziidi Shariah MMF will target registered M-Pesa customers who either profess the Islamic faith or prefer to invest in Shariah-compliant financial products.
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“This initiative aligns with the CMA’s efforts to promote inclusive and diverse investment opportunities within Kenya’s capital markets,” read part of the statement.
Ziidi Shariah MMF
With this approval, the number of licensed firms offering Shariah-compliant unit trust funds in Kenya now stands at seven.
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CMA Chief Executive Officer Wyckliffe Shamiah, while commenting on the approval, said, “This marks a significant milestone in the ongoing efforts to promote Islamic finance within Kenya’s capital markets. We believe Islamic finance holds immense potential which can be unlocked through creating an enabling environment for such opportunities to thrive”.
At the same time, CMA has announced the licensing of Tradiam Investments Services Limited as a fund manager, increasing the total number of licensed fund managers in Kenya to 43.
Shamiah observed that there has been substantial growth in the assets under management as collective investments schemes reach over Ksh316 billion.
This has driven the significant interest in fund management license category, according to CMA.
The authority noted that Tradiam Investments Services will target both institutional and retail clients.
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For institutional clients, the target includes pension schemes, insurance companies, and corporates seeking portfolio management services, while the retail investors under consideration are individuals looking for investment opportunities through collective investment schemes.
The approval of Gulfcap Investment Bank to register the Ziidi Shariah MMF comes after Safaricom launched its Ziidi MMF back in January.
CMA grants Safaricom approval to establish an MMF
The product enables customers to manage, grow, and control their finances and wealth, offering free deposits and withdrawals through their M-Pesa wallet.
CMA in November 2024 announced that it had granted Safaricom approval to establish the Ziidi MMF as a Collective Investment Scheme (CIS).
Following the approval, the telecommunications company on January 21 officially launched the fund in collaboration with two fund managers.
“Safaricom (NSE: SCOM) in partnership with two fund managers; Standard Investment Bank and ALA Capital Limited has today announced the official launch of Ziidi MMF, a money market fund that leverages the convenience of M-PESA to give customers a simple, faster and smarter way to invest and grow wealth,” read part of the press release.
The Ziidi MMF is a unit trust that allows customers to earn interest by investing funds from their M-PESA wallet into the Ziidi account.
Interest is accrued daily to the fund’s wallet, enabling investors to grow their money and generate more value over time.
Since its public launch in December 2024, Safaricom said that Ziidi MMF had attracted over 450,000 opt-ins with assets under management exceeding Ksh2.85 billion.
Customers can easily opt-in to Ziidi MMF on the M-Pesa app or through USSD by dialing the short code *334*5#.
After opting in, customers can immediately start investing. The fund offers customers visibility of the daily interest rate earned, making investing and growing money simple, transparent, and worry-free.
There is no maximum investment limit in the fund but the daily M-Pesa transaction limit of Ksh500,000 and the per-transaction limit of Ksh250,000 applies.
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 offer investors high liquidity and minimal risk.
Key characteristics of money market funds include high liquidity, allowing investors to quickly and easily access their funds, and low risk, as they invest in short-term, high-credit-quality debt securities, which helps minimize the likelihood of default.
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