All Things Fintech in Africa

How to Buy Safaricom Shares In Kenya (Full Guide)

Shares in Safaricom are traded on the Nairobi Stock Exchange (NSE), and there are a few different ways you can buy them.

This article will walk you through everything you need to know before investing in Safaricom shares. We will cover the basics of buying Safaricom shares, including the different methods you can use and the requirements you must meet.

We will also cover some risks associated with investing in Safaricom PLC and the potential benefits.

The process is easy, and with the guidelines about to be highlighted here, you can be among the shareholders of Safaricom.

Employees of Safaricom can also own shares through Employee Share Ownership Programs(ESOP). This is an incentive, with some available only to employees of Safaricom.

So whether you’re a seasoned investor or just starting, this article has everything you need to know about buying Safaricom shares!

How to Buy Safaricom Shares

There are two ways in which you can purchase your Safaricom shares:

1. Through your stock broker.

You will need to have an account with a stockbroker who the NSE licenses to trade shares.

The stockbroker will also be your custodian, holding the Safaricom shares bought on your behalf in a Central Depository System (CDS) account.

The advantage of using this method is that the stockbroker will provide you with expert advice on when to buy or sell your shares. They will also execute the trade on your behalf.

2. Online.

You can also buy Safaricom shares online without the need for a stockbroker. This is possible through your bank account, Mpesa or Bonga points.

However, you need to have a CDS account which can be opened at the central bank of Kenya or through licensed stockbrokers.

The advantage of this method is that it is convenient, and you don’t need to pay brokerage fees.

You will, however, need to do your research on when to buy or sell shares.

How to Open a CDS Account

  1. Visit the Central Bank of Kenya website and download the mandate card. (Individual) for individual investors and Mandate card (Corporate) for corporate investors
  2. Print the appropriate mandate card and fill out your details.
  3. Attach a recently taken coloured passport-sized photograph and a copy of the investor’s Kenyan National Identity Card (I.D.) or Passport. These documents MUST be certified by your bankers (A local commercial bank based in Kenya).
  4. Have the filled-in CDS mandate card certified by your Commercial bank.
  5. The Commercial investor bank will certify the completed CDS mandate card by way of appending the bank’s stamp and signatures of two of their authorized signatories on the space provided
  6. Scan the completed CDS mandate card and email it to [email protected]
  7. Send the physical mandate and attachments by post to: The Director, Financial Markets Department P.O. Box 60000- 00200, Nairobi, Kenya
  8. Once the CDS account has been opened, the investor will be notified of the CDS account number via email as provided on the CDS mandate card submitted to CBK. A formal letter of notification will follow after that.

How to Open a CDS Account Online in Kenya

You can do that through any good online share trading mobile app. You may also choose a USSD service.

To illustrate:

  1. Press USSD *543# ( this USSD code takes you to the AIB-AXYS capital platform.
  2. Next, click open new trading account.”

 How to Buy Safaricom Shares via a Stockbroker

Below are steps on how to buy Safaricom shares:

Step 1: Deposit the amount of money you want to invest in your CDS account. Your broker will give you details about the MPESA paybill number to use.

Side note:  The minimum number of Safaricom shares you can buy is 100 (and you order in multiples of 100 shares)

Step 2: Place your order with your broker/bank by filling in an order form.

That’s all your broker will proceed to execute your order, and the Safaricom shares you have just purchased will reflect in your newly opened CDS account within two days (maximum).

How to Buy Safaricom Shares Online

Buying Safaricom shares online is relatively easy and convenient instead of going back and forth trips to and from your stock broker.

With this method, you can pay online through an online funds transfer from your bank account or Mpesa.

Procedure:

  1. Log into your Online shares trading up
  2. Fund the account by adding cash via MPESA (or the method you usually use)
  3. Click buy Shares
  4. Scroll to select Safaricom shares
  5. Enter the quantity needed and set the price limit, if necessary.
  6. Confirm the order.
  7. Now, wait 24-48 hours for the order to be executed by the broker who owns the online trading platform.

 How to buy Safaricom shares using Bonga Points

To buy Safaricom shares using Bonga Points, you first need to place the order via the app or form, then wait.

You must redeem the Bonga Points first, then convert them into Kenyan shillings.

Follow the steps below to redeem the Bonga Points:

  • Dial *126#
  • Select ‘Lipa na Bonga’ menu
  • Select the ‘Paybill’ option
  • Click ‘Enter Business Number’
  • Key in the Paybill number provided by your stock dealer, then ‘OK.’
  • For the ‘Account Number’ option, fill in your CDSC account number, then ‘OK.’
  • Proceed to enter the amount you wish to pay in Kshs, then send.

What are Safaricom shares, and what do they represent?

Safaricom shares are stocks that give the shareholder a portion of ownership in the company.

The number of Safaricom shares you own depends on how much money you have invested in the company.

Each share represents a tiny fraction of ownership in the firm and can be bought or sold at any time during the day on the NSE.

Safaricom shares are equity or stocks and can be bought through a stockbroker.

The benefits of owning Safaricom shares

  • As a shareholder, you are entitled to a share of the company’s profits, which are paid out as dividends.
  • If the company does well, the value of your shares is likely to go up, and you can profit by selling them at a higher price than you paid.
  • Your Safaricom shares can also be used as collateral to borrow money.
  • The share price will likely continue rising as more people use Safaricom’s services and the company expands its business.
  • Safaricom is a well-managed company with a good reputation.
  • The shares are easily bought and sold on the NSE, so you can cash in your investment quickly if you need to.
  • Safaricom shares are a long-term investment, so you should not expect to make a quick profit from them.

Note: You could lose money if the share price falls.

Safaricom shares are not suitable for everyone, so you should speak to a financial advisor before investing.

The risks of owning Safaricom shares

  • The value of your investment can go down and up, so you could get back less than you originally paid for your shares.
  • Safaricom shares are not a savings account, so you could lose your money if the company goes bankrupt.
  • You may not be able to sell your shares quickly if there is no one else willing to buy them at the price you want.
  • The dividend payments may vary and could be cut altogether if the company’s profits fall.
  • You should not invest in Safaricom shares if you need your money within the next year.

Things to consider before buying Safaricom shares

Please do your research: Make sure you understand what Safaricom does and how it makes money.

Check the share price: Look at the share price history to see how volatile the shares are.

Consider the company’s financial position: Check its balance sheet and profit and loss account to see if it is in good financial health.

Think about the company’s prospects: Safaricom is a well-established company with a good reputation, but there is always a risk that it could be disrupted by new technology.

Consider your financial position: Make sure you can afford to risk losing all your investments.

Speak to a financial advisor: Get professional advice before making any decisions.

How to Sell Safaricom Shares:

If you want to sell your Safaricom shares, there are a few things you need to know. First, you’ll need a broker to help you sell your shares.

Second, you’ll need to decide how many shares you want to sell. Finally, you’ll need to set a price for your shares.

The next step is to agree on a price with the buyer. Once both parties have agreed on a price, the transaction will be processed, and the shares will be transferred to the buyer’s account.

It’s important to note that Safaricom shares can only be sold on the NSE, so you’ll need to find a buyer willing to purchase them on the exchange.

If you’re having trouble finding a buyer, contact a Safaricom share dealer for help.

The bottom line

Safaricom shares can be a good investment if you are willing to take risks.

You should only invest money you can afford to lose and always get professional advice before making any decisions.

Buying the shares can be achieved either online or through a broker. After following the above steps, you will be able to enjoy the fruits since the shares are very much profitable.

Finally, if you are interested in buying Safaricom shares, this is the perfect article to guide you through the steps to achieving your goal.

Frequently Asked Questions

How much do I need to buy Safaricom shares?

One is required to purchase a minimum of 500 shares at 52.5 Ksh. Pay a non-refundable admission fee of Kshs 10,000. The minimum monthly contribution is Ksh 3,000. The total to pay is Kshs 36,500.

How much do you earn from Safaricom shares?

This brings the total dividend for the year to KShs 55.69Bn (2021: KShs 54.89Bn), which represents KShs 1.39 per share in respect of the year ended 31 March 2022 (2021: KShs 1.37 per share).

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