In Kenya, the National Treasury offers two types of government securities: Treasury bills and Treasury bonds.
Treasury bills are a short-term investment, with maturities of 91 days, 182 days and 364 days. This means that if you invest money in a Treasury bill, you will receive that money back within three months, six months or one year, depending on the bill you choose.
Investors make money on Treasury bills because they are sold at a discount. For example, if you invest in a 91-day Treasury bill, you will pay less than the bill’s face value, but after 91 days you will receive the full face value.
If you’d like to purchase a Treasury bill, you must invest a minimum of Kshs. 100,000.
Treasury bonds are medium- to long-term investments, and their maturity can range from one year to 30 years. There are many different types of Treasury bonds, but their basic operations are similar.
Investors buying Treasury bonds are loaning the government money for a specified period of time, which is the bond’s maturity. With most bonds, investors will receive interest payments every six months throughout that period of time, and at the end of that period they receive the face value amount that they invested.
If you’d like to purchase a Treasury bond, you must invest a minimum of Kshs. 50,000.