President William Ruto has unveiled the first Shariah-compliant bond in Kenya, the ‘Linzi Sukuk,’ on the Nairobi Securities Exchange’s (NSE’s) Unquoted Securities Platform (USP).

The Ulinzi Sukuk, valued at Kes 3 billion, will finance the development of 3,069 affordable housing units, which the head of state now says will address the country's critical need for affordable housing.

Speaking during the launch, the Head of State emphasized the importance of this initiative in fostering a dynamic and inclusive capital market with the potential to positively impact various sectors.

“I am delighted by the response and commitment and commend your efforts in crafting this landmark asset-based security which has the potential to enhance efficiency in the delivery of our priority projects through optimal financial costs,” he said.

Further, he expressed confidence that financing affordable housing through innovative financial instruments would create numerous job opportunities for Kenyans and stimulate commerce through public-private partnerships.

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Last year, the Linzi Finsco Trust received a nod from the Capital Markets Authority of Kenya (CMA) to float the country’s inaugural Islamic bond.

Unlike traditional bonds, a sukuk bond complies with Sharia law, which prohibits the payment of interest.

Instead, sukuk bonds provide investors with a share of the profits generated by the underlying assets.

The introduction of the Linzi Sukuk bond is expected to attract a diverse pool of investors, particularly those seeking Sharia-compliant investment opportunities.