The Kenyan money market funds (MMFs) have experienced massive inflows since the beginning of 2024 when the Central Bank of Kenya (CBK) raised its base rates, resulting in higher yields for the open‐end collective investment funds that invest in short-term fixed-income securities such as government Treasury bills, commercial papers and promissory notes.
To date, several money market fund providers with mouthwatering rates in their MMF accounts continue to garner attention as a way for investors to keep cash safe while earning consistent income. One of them is the Sanlam Money Market Fund –
Sanlam Money Market Fund is popular because its provider, Sanlam, the largest non-banking financial services group on the African continent, in Sanlam Investments East Africa Limited through Sanlam Kenya PLC is listed on the Nairobi Securities Exchange (NSE) and hence considered a big player.
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The Fund’s investment objective is to deliver a high level of current income while seeking to maintain liquidity and low principal volatility by predominantly investing in short-term obligations that present minimal credit risk, like the previously mentioned government T-bills and commercial papers.
What is the interest rate of Sanlam Money Market Fund in 2024?
As said, a money market fund is a mutual fund that invests in short-term debts. In June, towards July 2024, the Sanlam Money Market Fund has retained its 15.32% Effective Annual Yield from May, paying 9.68% in real interest after deducting applicable taxes and a management fee of 1.2%. With that, you can earn between Ksh10,163 and Ksh16,552 in interest on Ksh100,000 annually.
Interest will be compounded daily but credited monthly on the principal balance on the last business day of the month.
On the issue of withdrawals of funds from the MMF accounts, Sanlam says it allows one free withdrawal per month and subsequent withdrawals within the same month incur a fee of Ksh500 per transaction.
What is the minimum investment for a Sanlam money market account?
A minimum investment of Ksh2,500 is required to open this account and start investing, and the minimum amount one can top up is Ksh1,000. There is no balance requirement to obtain the annual percentage yield disclosed.
How do you start investing?
Here are simple steps to get started, assuming you already have your investment goals in place:
* Before you begin, kindly ensure you have all the required documents, which are your National ID or passport, tax document (KRA PIN), Passport photo and a recent bank statement, a cancelled cheque or ATM card in PDF, JPEG, JPG or PNG formats
How do you start investing in the Sanlam Money Market Fund?
1. Visit invest.sanlameastafrica.com
2. Go to the Money Market Fund tab and click ‘Start Investing’ in blue
3. Fill in your bio-data as they appear in identity documents on the next page
4. Pass Risk Assessment
5. Supply your bank details
6. Add beneficiaries
7. Upload all the documents as required
8. Submit
Afterwards, you will receive a call from Sanlam Money Market Fund to help you finish the MMF account creation and start investing;
Before you start investing, it may be helpful to understand more concepts related to their money market fund as there is no guarantee you will be able to get returns that reflect the level of the posted short-term interest rates because they are dependent on inflation and other market forces.
