New M-PESA Investment Option Offers Shari’ah-Compliant Money Market Fund Access
Safaricom has expanded its investment offering with Ziidi Shari’ah, a money market fund designed to follow Islamic finance principles. The product gives eligible M-PESA customers another way to invest through a platform they already use for everyday financial transactions.
Customers can access the fund through My OneApp or by dialing *334#. The minimum initial investment is KES 100, while subsequent contributions can start from KES 10. This low entry point is designed to make investment more accessible to customers who may not have large amounts of money available to invest at once.
Ziidi Shari’ah differs from a conventional money market fund because it does not invest in interest-bearing instruments. Instead, the fund uses investment structures designed to comply with Shari’ah principles, including permitted profit-sharing arrangements.
The fund also applies sector-based restrictions. Its investments exclude industries considered incompatible with Islamic finance principles, including alcohol, gambling, tobacco, conventional interest-based banking and weapons manufacturing.
Importantly, the product is not restricted to Muslim customers. Safaricom says the Shari’ah designation describes the principles governing how the fund invests rather than limiting access according to a customer’s religion. This potentially positions the product as an option for investors interested in faith-based or ethical investment approaches.
The fund was launched in partnership with GulfCap Investment Bank, which will manage and administer it. KCB Bank will serve as trustee, while GulfCap’s Shari’ah Supervisory Board will oversee compliance with Islamic finance requirements.
How Ziidi Shari’ah Works
Ziidi Shari’ah allows customers to invest using M-PESA without needing to open a separate traditional investment account for the service.
Eligible customers can begin with KES 100 and subsequently add as little as KES 10. This structure gives customers the flexibility to build their investment gradually rather than requiring a large initial contribution.
The service is available through My OneApp and the *334# USSD platform. This provides both smartphone and USSD access, which can make the product available to customers using different types of mobile devices.
Returns accrue daily, but they are variable. The amount an investor earns depends on the performance of the underlying investments and should not be interpreted as a guaranteed return.
Customers can deposit money into the fund through M-PESA and withdraw their money back to their M-PESA wallets. According to the product information, these M-PESA deposits and withdrawals do not attract transaction charges.
However, investment returns are subject to applicable Kenyan tax requirements. A 15% withholding tax is automatically deducted from returns.
What Makes the Fund Shari’ah Compliant?
The defining feature of Ziidi Shari’ah is the way the fund’s money is invested.
Conventional financial products can generate returns through interest-bearing instruments. Islamic finance generally prohibits riba, commonly understood as interest, and places restrictions on certain business activities and investment structures.
Ziidi Shari’ah therefore uses investment arrangements that are intended to comply with Shari’ah principles rather than relying on conventional interest-based instruments.
The fund also excludes businesses operating in sectors that are considered incompatible with Islamic finance requirements. These include:
- Alcohol
- Gambling
- Tobacco
- Conventional interest-based banking
- Weapons manufacturing
The purpose of these restrictions is to align the investment portfolio with the ethical and financial requirements governing Shari’ah-compliant investments.
The fund’s Shari’ah Supervisory Board is responsible for overseeing compliance with these requirements. This provides an additional governance layer alongside the normal management and trustee arrangements.
Who Can Invest in Ziidi Shari’ah?
Although the product is designed around Islamic finance principles, Safaricom says it is not exclusively for Muslim customers.
Anyone eligible to use the investment service can potentially consider Ziidi Shari’ah, subject to the applicable requirements. The Shari’ah label relates to the investment methodology rather than the religious identity of the investor.
This distinction could make the fund relevant to customers who are interested in ethical investing or who simply prefer an investment structure that avoids interest-bearing instruments.
For Muslim investors, the product may provide an investment option that is designed specifically around Islamic finance requirements. For other investors, the restrictions may appeal to those seeking a particular ethical investment framework.
How Much Money Do You Need to Start?
One of the notable features of Ziidi Shari’ah is its relatively low minimum investment.
Customers can start with KES 100 and make additional contributions from KES 10. This lowers the financial barrier for people who want to begin investing with small amounts.
For example, a customer could start with KES 100 and gradually add money whenever they have funds available. However, investors should remember that the size of their investment will influence the potential amount of returns they receive.
The low minimum should therefore be viewed as an accessibility feature rather than a guarantee of significant investment growth.
Before investing, customers should understand that returns are variable and depend on the performance of the underlying portfolio.
How Customers Access Their Money
M-PESA provides the transaction channel for deposits and withdrawals.
Customers can move money into the investment product from their M-PESA wallets and withdraw funds back to their wallets. Safaricom says there are no transaction charges for these M-PESA deposits and withdrawals.
This integration makes the product different from investment services that require customers to transfer money through separate bank accounts or financial platforms.
However, investors should still review the applicable fund terms before committing money. Investment products can have specific rules concerning transactions, taxation, processing and returns.
The 15% withholding tax on investment returns is automatically deducted in accordance with Kenyan tax requirements.
Ziidi Shari’ah vs Conventional Ziidi
Ziidi Shari’ah operates separately from Safaricom’s conventional Ziidi Money Market Fund.
Both products are accessible through the M-PESA ecosystem, but their investment approaches differ significantly.
The conventional Ziidi fund invests in money market instruments that generate interest-based returns. Ziidi Shari’ah, by contrast, uses investment structures designed to comply with Islamic finance principles and avoids interest-bearing investments.
The difference can be summarised as follows:
| Feature | Ziidi Shari’ah | Conventional Ziidi |
|---|---|---|
| Investment approach | Shari’ah-compliant | Conventional money market |
| Interest-bearing instruments | Excluded | Used within the fund’s strategy |
| Initial investment | KES 100 | Product-specific terms apply |
| Subsequent contribution | From KES 10 | Product-specific terms apply |
| M-PESA access | Yes | Yes |
| Returns | Variable | Variable |
| Target users | Eligible M-PESA customers | Eligible M-PESA customers |
Customers should therefore choose between the products based on their financial objectives, investment preferences and understanding of the respective fund structures.
Role of GulfCap and KCB Bank
Safaricom has partnered with established financial institutions to operate and oversee Ziidi Shari’ah.
GulfCap Investment Bank will manage and administer the fund. Its Shari’ah Supervisory Board will also oversee compliance with the applicable Islamic finance principles.
KCB Bank will act as trustee.
These roles are important because investment funds require governance structures that separate portfolio management from oversight and protect the interests of investors.
The arrangement also gives the product a framework for managing investments and maintaining Shari’ah compliance.
Regulatory Approval and Financial Inclusion
The Capital Markets Authority approved Ziidi Shari’ah in February 2025.
At the launch, CMA Senior Manager for Market Deepening Justus Agoti, representing CMA CEO Wyckliffe Shamiah, highlighted the product’s potential contribution to financial inclusion and capital mobilisation.
The regulator is also working on a broader governance framework for Shari’ah-compliant investment products as interest in faith-based financial services grows.
This could become increasingly important as more financial institutions develop products aimed at customers who want investment options that follow specific ethical or religious principles.
For Kenya’s financial sector, the development also demonstrates how mobile platforms can make investment products available to a wider audience.
What Ziidi Shari’ah Means for M-PESA
M-PESA has developed beyond its original role as a platform for sending and receiving money. The addition of investment products allows customers to use the same ecosystem for broader financial activities.
Ziidi Shari’ah strengthens this direction by giving customers another investment option with a low entry point and mobile-based access.
For Safaricom, the product also expands the range of financial services available through My OneApp and USSD. For investors, it provides another route into a professionally managed fund without requiring a large starting balance.
However, customers should remember that a money market fund is still an investment product. Returns are variable, investment performance can change and applicable taxes and fund terms still apply.
Ziidi Shari’ah therefore represents a new choice rather than a guaranteed way to grow money. Its significance lies in combining mobile investment access with an investment structure designed to meet Shari’ah requirements, potentially widening the range of financial products available to Kenyan consumers.
