Ziidi Money Market Fund is a unit trust collective investment scheme that allows M-Pesa customers to earn competitive daily interest on their savings. The fund invests primarily in low-risk instruments including government securities such as Treasury bills and interest-earning accounts. According to Safaricom's official documentation, the interest rate varies daily based on market conditions, and funds begin earning interest just 24 hours after deposit.
Current Investment Options
1. Individual Money Market Fund (Primary Option)
As currently approved by the Capital Markets Authority, Ziidi MMF operates primarily as an individual investment fund. This is the main and currently only available investment option for M-Pesa users.
Key Features:
- Minimum investment: KES 100
- Minimum withdrawal: KES 10
- No maximum investment limit (subject to M-Pesa transaction limits)
- Daily interest accrual beginning 24 hours after deposit
- Zero transaction fees for deposits and withdrawals
- Real-time access to funds
Investment Characteristics:
- The fund invests in government securities (T-bills) and interest-earning accounts
- Interest rates are competitive and change daily
- Returns displayed are net returns after the 2% annual fund management fee
- Interest earned is subject to 15% withholding tax (standard for all interest-earning investments in Kenya)
2. Fund Locking Feature
While technically not a separate investment option, Ziidi MMF offers a fund locking feature that provides investors with enhanced financial discipline tools.
How Fund Locking Works:
- Investors can voluntarily lock their funds for any period they choose
- Locked funds earn the same interest rate as unlocked funds
- No limits on the amount that can be locked (must not exceed available balance)
- No fees charged for locking or unlocking funds
- Funds can be topped up at any time while locked
- Unlocking requires a 72-hour processing period
- Only the entire locked amount can be unlocked, not partial amounts
Purpose of Fund Locking: Locking funds helps investors avoid unplanned spending, adds an extra layer of control, and assists in maintaining financial discipline and achieving financial goals.
3. Future Investment Options (Under Development)
Additional investment options are in development and will be unveiled soon:
Chama and Business Accounts:
- Currently, Ziidi MMF is approved only for individual investors
- Group investment accounts for chamas (informal savings groups) and businesses are being developed
- Expected to launch in the near future pending regulatory approval
Shariah-Compliant Option:
- A Shariah-compliant investment option is currently under development
- This will cater to investors seeking investments aligned with Islamic financial principles
- Timeline for launch to be announced
Special Features: Fund Locking
The fund locking feature provides investors with a tool for enhanced financial discipline while maintaining earning potential.
How to Lock Funds
Via M-Pesa App:
- Open Ziidi on the M-Pesa App
- Select "Lock Funds" option
- Enter amount to lock (must not exceed available balance)
- Confirm with M-Pesa PIN
- Receive confirmation
*Via USSD 334#:
- Dial *334#
- Navigate to Ziidi
- Select "Lock Funds"
- Follow prompts and enter amount
- Confirm with PIN
Benefits of Locking Funds
- Prevents impulsive spending
- Helps maintain financial discipline
- Assists in achieving specific financial goals
- Provides psychological commitment to savings
- Still earns the same competitive daily interest
Unlocking Process
- Can only unlock the entire locked amount (no partial unlocking)
- 72-hour processing period required
- No fees for unlocking
- No limit on the amount that can be unlocked
Advantages of Ziidi MMF
- Accessibility: Start investing with just KES 100, making wealth creation available to all income levels
- Convenience: Integrated with M-Pesa, accessible from any phone type
- Zero Fees: No transaction costs for deposits or withdrawals
- Daily Returns: Interest accrues daily, with full transparency
- Instant Access: Withdraw funds in real-time with no waiting periods
- Flexibility: No maximum investment limits or withdrawal restrictions
- Security: Protected by M-Pesa's robust security infrastructure
- Regulated: Supervised by the Capital Markets Authority for investor protection
- Professional Management: Managed by reputable fund managers with proven track records
- Financial Discipline Tools: Fund locking feature helps achieve savings goals
Important Considerations
Before Investing
- Understand that returns vary daily based on market conditions
- Interest rates are not guaranteed and may fluctuate
- Money market funds carry low but not zero risk
- Returns are subject to taxation (15% withholding tax)
- Funds must remain in the account for 24 hours before earning interest
Account Management
- Keep your M-Pesa PIN secure and never share it
- Regularly monitor your investment performance
- Update your Next of Kin information if circumstances change
- Be aware of M-Pesa daily transaction limits when planning large deposits or withdrawals
- Cannot change account ownership without withdrawing all funds and re-registering
