Introduction

For many years, Treasury Bonds sounded like investments meant only for:

• Banks
• Pension funds
• Wealthy investors in suits carrying briefcases

Today?

Ordinary Kenyans can buy Treasury Bonds directly from their phones.

Thanks to the Central Bank of Kenya’s DhowCSD platform, investing in government bonds has become far more accessible. And the best part?

You do not need a stockbroker to get started.

Let’s walk through the full process — step by step.

First, What Is a Treasury Bond?

A Treasury Bond (T-Bond) is a medium- or long-term investment issued by the Kenyan government through CBK.

When you buy one:

You are lending money to the government for several years.

In return, the government usually pays:

✅ Interest every 6 months

✅ Your principal back at maturity

Treasury Bonds in Kenya can range from:

• 1 year
• To as long as 30 years.

Why Many Kenyans Invest in Treasury Bonds

Treasury Bonds are popular because they offer:

✅ Government-backed investing

✅ Predictable income

✅ Semi-annual coupon payments

✅ Potentially attractive yields

Many investors use them for:

• Long-term savings
• Retirement planning
• Passive income
• Wealth preservation

What Is DhowCSD?

DhowCSD is CBK’s online investor platform where you can:

• Open a CDS account
• Buy Treasury Bonds
• Buy Treasury Bills
• Track investments
• Receive auction results
• Manage your government securities online

You can access it through:

• Mobile app
• Web portal

Before You Start — What You Need

Here’s your Treasury Bond starter checklist:

You must also generally be:

At least 18 years old.

Step by Step — How to Buy Treasury Bonds

Step 1: Open a DhowCSD Account

Start here:

CBK DhowCSD Portal

Or download the DhowCSD mobile app.

During Registration You Will:

Enter Personal Information

You’ll provide:

• Full name
• ID/passport details
• KRA PIN
• Phone number
• Email address

Upload Documents

You may need:

• Passport photo
• Copy of ID/passport
• KRA PIN certificate

Add Bank Details

This is where:

• Coupon payments
• Maturity proceeds

…will be sent.

Fun Fact

Opening a CDS account used to take:

Weeks.

Today, approvals often take:

Around 2–3 business days if documents are correct.

Step 2: Wait for Upcoming Bond Auctions

CBK regularly announces Treasury Bond auctions.

Each bond comes with details such as:

• Coupon rate
• Bond tenor
• Auction dates
• Settlement dates
• Minimum investment

These are published on:

• CBK website
• DhowCSD portal

Step 3: Understand the Bond Offer

Before investing, carefully review:

• Bond duration
• Coupon rate
• Tax treatment
• Maturity date

Example:

You may see:

• A 15-year bond paying 12.756%
• Or a 25-year bond paying 13.4%

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Step 4: Log Into DhowCSD and Create a Bid

Once logged in:

• Go to the Auctions section
• Select your preferred Treasury Bond
• Click:

“Create Bid”

Step 5: Choose Your Bid Type

This part confuses many beginners…

but it’s actually simple.

Non-Competitive Bid (Beginner-Friendly)

This means:

“I accept the final average yield decided at auction.”

Most retail investors use this option because:

✅ Easier

✅ Simpler

✅ Higher allocation chances

Competitive Bid

This means:

You specify the interest rate/yield you want.

But:

• If your requested yield is too high
• Your bid may be rejected

Competitive bids are usually used by:

• Institutions
• Experienced investors

Step 6: Decide How Much to Invest

For many Treasury Bonds:

• Non-competitive bids may start from:

KSh 50,000

Meanwhile:

• Competitive bids often require:

KSh 2 million minimum

Step 7: Submit Your Bid Before Deadline

Treasury Bond auctions have strict deadlines.

Miss the cut-off?

Your application won’t be processed.

Always double-check:

✅ Auction date

✅ Submission deadline

✅ Settlement date

Step 8: Wait for Auction Results

After the auction:

• CBK publishes the results
• Successful investors receive allocation information

You’ll see:

• Amount allocated
• Accepted yield
• Payment instructions

Step 9: Make Payment

If your bid succeeds:

You must pay before the settlement deadline.

Payments are usually made:

• Via commercial bank transfer
• Through DhowCSD instructions

CBK has also enabled:

M-Pesa payments for certain limits through DhowCSD.

Step 10: Receive Your Treasury Bond

Once payment is confirmed:

• The bond is credited to your CDS account

Then:

✅ You begin earning coupon payments

✅ Interest is paid semi-annually

✅ Principal is repaid at maturity

How Treasury Bonds Make Money

Treasury Bonds usually pay:

Semi-annual coupon income.

Example:

If you invest:

• KSh 100,000
• In a 12% bond

Approximate annual coupon becomes:

100000 * 0.12

Approximate yearly income:

KSh 12,000 before tax

Usually paid as:

Two KSh 6,000 payments every 6 months.

Can You Sell Before Maturity?

Yes.

Treasury Bonds can be traded on the:

Nairobi Securities Exchange secondary market.

However:

• Bond prices fluctuate
• You may sell at a profit or loss

Treasury Bond Taxes in Kenya

Most Treasury Bond coupon payments are generally subject to:

10% or 15% withholding tax depending on the bond structure.

Some Infrastructure Bonds (IFBs) may be tax-exempt where stated in the

prospectus.

Always verify:

The specific tax treatment in the bond prospectus.

Common Mistakes Beginners Make

1. Ignoring Auction Deadlines

Late bids are rejected.

2. Using Competitive Bids Without Understanding Them

Non-competitive bids are usually safer for beginners.

3. Locking Emergency Money

Some bonds run for:

• 5 years
• 10 years
• 20+ years

4. Focusing Only on High Coupons

Also consider:

• Tenor
• Tax
• Liquidity
• Inflation

Treasury Bonds vs Treasury Bills — Quick Difference

The Bottom Line

Treasury Bonds in Kenya are now far easier to access than before.

With:

• A smartphone
• KRA PIN
• Bank account
• DhowCSD account

…ordinary Kenyans can directly invest in government securities online.

And while the process may initially look intimidating:

It becomes surprisingly straightforward once you understand the steps.

Because ultimately:

Treasury Bonds are no longer “elite investments” — they are becoming mainstream financial tools for everyday investors.

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