Safaricom’s debut green bond has completely blown away Kenya’s corporate debt market. Targeting KSh 15 billion, the five-year tax-exempt note attracted an incredible KSh 41.6 billion in bids, an oversubscription of 175.7%, the largest ever for a Kenyan corporate issue.
Safaricom ultimately upsized to KSh 20 billion via its full greenshoe and refunded KSh 21.4 billion to investors left on the sidelines.
The fixed 10.4% coupon, payable semi-annually and shielded entirely from withholding tax, elevated the instrument to the rarest category in local fixed income: high-yield, low-risk, tax-free, ESG-aligned paper from a blue-chip issuer.
The result was a stampede with pension funds, insurance companies, banks, asset managers, and retail investors all piling in as Kenya’s dormant corporate bond market finally roared back to life.
The catalyst? A perfect storm of four growth drivers.
1. A Tax-Exempt Structure That Supercharged Yields
The biggest accelerant was the bond’s full exemption from the 15% withholding tax reserved only for certified green instruments financing eligible environmental projects.
The impact on returns was dramatic.
- Safaricom green bond: 10.4% tax-free
- Equivalent taxable bond: ~12.3% gross to match the same after-tax yield
- EABL’s recent corporate note: 11.8% coupon → ~10% net
With inflation steady at 5–6% and Treasury yields tightening, the tax shield made Safaricom’s note one of the most attractive risk-adjusted instruments in the market.
Retail investors able to join from KSh 50,000 took early notice. “The tax-exempt bond attracted KSh 41.6 billion in bids,” one analyst noted online. The maths did the selling.
2. ESG Momentum and a Credible Green Pipeline
Safaricom’s use-of-proceeds plan ticked every ESG box investors care about:
- solarising hundreds of base stations
- advanced energy-management systems
- carbon-emissions reduction
- network efficiency upgrades
With telecoms consuming up to 3% of national electricity, the impact case was tangible. The bond met Kenya’s Green Bond Standards, ensuring ring-fenced, auditable deployment critical for institutional capital with ESG mandates.
Capital A Investment Bank summed it up: “We anticipate strong, potentially oversubscribed demand supported by growing global and local appetite for ESG-linked investments.”They were right.
3. Safaricom’s Balance Sheet: The Ultimate Comfort Blanket
Investors weren’t just buying a green story; they were buying Safaricom.
Half-year profits surged 52.1% to KSh 42.7 billion, powered by data revenue and a stabilising Ethiopia rollout. With 42+ million customers, a quasi-utility market position, and unrivalled cash flow, Safaricom remains the Nairobi Securities Exchange’s safest corporate credit.
CEO Peter Ndegwa captured the sentiment:
“The response shows confidence in our balance sheet and the strategy we are executing.”
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Who Can Apply for Safaricom’s Tax-Free Green Bond and How to Get Started
4. A Thirsty Market and a Starved Corporate Bond Pipeline
Kenya’s corporate bond market has been dry for years. Investors have been sitting on liquidity with nowhere to deploy it as Treasury issuance crowded out private credit and defaults soured confidence.
But 2025 has flipped the script.
- EABL’s KSh 16.7 billion note: 152.4% oversubscribed
- Safaricom’s Sh40 billion MTN programme: a new benchmark for quality paper
With few high-grade issuers and rising appetite for alternatives to government securities, demand was always going to be hot. Safaricom’s ESG angle and tax exemption simply sparked a blaze.
Add strong retail distribution via USSD, apps, and brokers and the order book filled itself.
The bond lists on the NSE on December 16, creating fresh liquidity in the green-debt segment and giving income investors a new anchor.
For Safaricom, it validates its shift toward sustainable finance after its Sh30 billion sustainability-linked loan earlier this year.
For Kenya, the signal is even bigger: credible issuers can raise climate-aligned capital at scale fast.
Safaricom Bonds Overview
Safaricom bond rates continue to attract investors looking for stable returns, with many seeking details on the Safaricom bond interest rate and the latest Safaricom bond offer, including the popular Safaricom green notes issued to fund sustainability projects.
New and retail investors often look up ‘How to invest in Safaricom bonds’ and ‘How to buy Safaricom bonds online’, especially through digital channels enabled by the Safaricom bond e-offer, which simplifies participation in current and upcoming issuances.
Ronnie Paul is a seasoned writer and analyst with a prolific portfolio of over 1,000 published articles, specialising in fintech, cryptocurrency, climate change, and digital finance at Africa Digest News.
