Ziidi MMF is a unit trust fund that enables M-PESA customers to invest in a money market fund and earn competitive daily interest. As a collective investment scheme (CIS) licensed by the Capital Markets Authority (CMA), Ziidi pools funds from multiple investors and channels them into low-risk investments such as government securities, Treasury bills, and interest-earning accounts.
The name "Ziidi" reflects the Swahili concept that "a little goes a long way," emphasizing that even small investments can grow over time and generate meaningful value. This philosophy underpins Safaricom's commitment to financial inclusion and wealth creation for all Kenyans, regardless of their income level.
Fund Management and Structure
Fund Managers
Ziidi MMF is managed by a pool of licensed fund managers:
Standard Investment Bank (SIB): A leading financial services firm in Kenya founded in 1995, SIB manages over KES 60 billion in assets. The firm has a proven track record of providing above-market-average returns and has successfully closed over 70 project transactions worth KES 300 billion.
ALA Capital Limited: Partner fund manager working alongside SIB to manage the Ziidi portfolio.
Trustee
KCB Bank (Kenya) Limited serves as the trustee for the scheme, responsible for oversight and ensuring compliance with regulatory requirements.
Investment Strategy
Ziidi MMF invests primarily in:
- Government securities such as Treasury bills
- Interest-earning accounts with financial institutions
These are considered low-risk investments, making the fund suitable for conservative investors seeking steady returns while preserving capital.
Key Features and Benefits
1. Low Minimum Investment
Start investing with just KES 100, making wealth creation accessible to virtually everyone. The minimum withdrawal amount is KES 10, providing flexibility for small transactions.
2. Daily Interest Accrual
Interest is computed daily and reflected in your account. Your funds start earning interest 24 hours after depositing, ensuring continuous growth of your investment.
3. Zero Transaction Costs
All deposits and withdrawals between your M-PESA wallet and Ziidi MMF account are completely free. There are no maintenance fees, making it a cost-effective investment option.
4. Real-Time Access
Withdraw funds from your Ziidi MMF account and instantly receive them in your M-PESA wallet. There are no waiting periods of days or hours, and no limits on the number of daily withdrawals.
5. Easy Tracking
Monitor your investment performance through the Ziidi mini app homepage under "Investment Performance" or by dialing *334#. This transparency helps with financial planning and tracking.
6. Security
Your investment is protected by your M-PESA PIN, which is required for sign-up and every transaction. Safaricom emphasizes that customers should never share their M-PESA PIN with anyone.
7. No Maximum Investment Limit
While the minimum is KES 100, there is no maximum investment limit. However, standard M-PESA transaction limits apply: KES 500,000 per day and KES 250,000 per transaction.
8. Accessible on Any Phone
Whether you have a smartphone or a basic feature phone, you can access and manage your Ziidi investment, ensuring inclusivity.
Investment Returns and Fees
Interest Rates
Ziidi MMF offers variable interest rates that change daily based on the performance of underlying investments. The rate is determined by:
- Performance of government securities (Treasury bills)
- Returns from interest-earning accounts
- Current market conditions
The daily interest rate is displayed on the M-PESA App and when accessing Ziidi through *334#, providing transparency on returns.
Fund Management Fee
A 2% per annum fund management fee is charged. However, the interest rate displayed to investors is the net return after deducting this fee, ensuring transparency and eliminating confusion about actual earnings.
Withholding Tax
Like all interest-earning investments in Kenya, Ziidi MMF income is subject to a 15% withholding tax, which is automatically deducted from earnings.
Additional Fees
- Trustee Fee: 0.2% per annum
- Custodian Fee: 0.15% per annum
These fees are standard for collective investment schemes and are factored into the net returns displayed to investors.
The Fund Locking Feature
Ziidi offers a unique fund locking feature designed to promote financial discipline and help customers achieve their savings goals.
How Fund Locking Works
Purpose: Locking funds helps set aside money and avoid unplanned spending. It adds an extra layer of control, helping you stay committed to financial goals.
Flexibility: There is no fixed locking period. You can lock funds for as long as needed using the Ziidi Mini-App on the M-PESA App or USSD *334#.
Top-ups: You can freely add more funds to your locked balance at any time.
No Transaction Limits: There is no limit to the amount that can be locked or unlocked, though the amount locked must be less than or equal to your available Ziidi MMF balance.
No Additional Fees: Locking and unlocking funds incurs no charges.
Important Considerations
Unlocking Period: When you unlock funds, they become available 72 hours later. This cooling-off period reinforces the discipline aspect of the feature.
All-or-Nothing Unlock: You can only unlock the entire locked amount, not partial withdrawals. This ensures commitment to the locking decision.
Same Interest Rate: Locked funds earn the same interest rate as unlocked funds. The primary benefit is behavioral—helping overcome impulsive spending and building financial discipline.
Next of Kin and Inheritance
Designating a Next of Kin
Ziidi MMF allows customers to designate a Next of Kin who can access funds in the event of incapacitation or death. This information is updated through the Ziidi mini app.
Next of Kin Claims Process
In the event of a claim, the Next of Kin must visit the nearest Safaricom Retail Shop or Care Desk with the following documents:
- A duly filled Ziidi Next of Kin claim of funds form
- Valid identification document (ID)
- Death Certificate (in case of death)
- Grant of Probate or Letter of Administration
- Letter from local administration ascertaining the heir
Account Ownership Transfer
It's important to note that you cannot directly change ownership of your Ziidi account or transfer it to your Next of Kin while alive. If ownership transfer is needed, you must:
- Withdraw all funds from Ziidi
- Opt out of Ziidi
- Follow Safaricom's standard process for changing mobile number ownership and account details
Important Limitations and Considerations
1. Individual Accounts Only
Currently, only individual M-PESA customers can open Ziidi accounts. Joint accounts, chama accounts, and business accounts are not yet available.
2. M-PESA Exclusive
All deposits and withdrawals must go through your M-PESA wallet. Direct transfers to/from bank accounts or agents are not permitted.
3. Variable Returns
Interest rates fluctuate daily based on market conditions and investment performance. Unlike fixed deposits, returns are not guaranteed.
4. Investment Risk
While money market funds are considered low-risk, they are not risk-free. The value of investments can fluctuate based on market conditions.
5. No FDIC-Style Protection
Unlike bank deposits protected by the Kenya Deposit Insurance Corporation, money market fund investments are not covered by deposit insurance.
6. Liability Limitations
According to the terms and conditions, Safaricom excludes all liability that may arise from any loss or damage suffered by investors on account of the investment or administration of the fund. The fund managers retain primary responsibility for investment performance.
