Safaricom Plc is the largest company listed on the Nairobi Securities Exchange (NSE) by market value, and learning how to buy Safaricom shares helps investors understand both the mechanics of share trading and the basics of long-term investing.
Safaricom shares are traded publicly on the NSE under the ticker symbol SCOM. This means anyone who meets the basic requirements can buy or sell the shares through a licensed stockbroker or investment bank. While the process is straightforward, understanding each step reduces mistakes and helps you invest with confidence.
What Are Safaricom Shares?
Safaricom shares represent ownership in Safaricom Plc, a leading telecommunications company in Kenya. When you buy these shares, you become a shareholder and are entitled to certain rights, including dividends and voting at annual general meetings.
The company’s strong brand, large customer base, and steady cash flows make its shares attractive to both retail and institutional investors. However, like all equities, Safaricom shares fluctuate in price based on market conditions, company performance, and investor sentiment.
Why Investors Choose Safaricom Shares
Many investors are drawn to Safaricom shares because of the company’s size, stability, and visibility in the Kenyan economy. The business has historically generated consistent revenue, largely driven by mobile services and digital platforms.
Another reason investors prefer Safaricom is its track record of dividend payments. Although dividends are never guaranteed, the company has paid dividends regularly in the past, making it appealing to income-focused investors.
Requirements for Buying Safaricom Shares
Before you can buy Safaricom shares, you must meet a few basic requirements set by regulators and market institutions. These requirements ensure transparency and protect both investors and the market.
You will need:
- A Central Depository System (CDS) account
- An account with a licensed stockbroker or investment bank
- A valid national ID or passport
- Access to funds for buying shares and paying transaction costs
Meeting these requirements is mandatory, and skipping any step will prevent you from completing a trade.
Understanding a CDS Account
A CDS account is a personal electronic account that holds your shares in digital form. It is managed by the Central Depository and Settlement Corporation (CDSC), which records ownership of shares traded on the NSE.
Without a CDS account, you cannot buy or sell Safaricom shares. The account ensures your shares are safely stored and transferred electronically whenever you trade.
How to Open a CDS Account
Opening a CDS account is the first practical step in learning how to buy Safaricom shares. The process is simple and usually free when done through a stockbroker.
You can open a CDS account by:
- Visiting a licensed stockbroker or investment bank
- Providing identification documents and passport photos
- Filling out CDS and brokerage account forms
Most brokers now offer online account opening, which makes the process faster and more convenient, especially for investors outside major towns.
Choosing a Licensed Stockbroker
A licensed stockbroker acts as the middleman between you and the NSE. They execute buy and sell orders on your behalf and provide access to trading platforms and market information.
When choosing a broker, consider their reputation, customer service, trading fees, and platform reliability. A broker licensed by the Capital Markets Authority (CMA) ensures your transactions follow Kenyan securities regulations.
How to Buy Safaricom Shares Step by Step
Buying Safaricom shares follows a structured process that protects investors and ensures fair trading. Each step builds on the previous one, so it’s important to follow the sequence carefully.
First, fund your trading account with your broker. Once the funds reflect, place a buy order specifying the number of shares and the price you are willing to pay. The broker then matches your order on the NSE, and once executed, the shares are credited to your CDS account.
Understanding Share Prices and Market Orders
Safaricom shares trade at market-driven prices that change throughout the trading day. These prices are influenced by demand, supply, and broader market conditions.
You can place different types of orders:
- Market orders, which buy shares at the best available price
- Limit orders, which buy shares only at a price you specify
Understanding these order types helps you control costs and avoid unexpected price movements.
Minimum Amount Needed to Buy Safaricom Shares
There is no fixed minimum investment amount, but the total cost depends on the share price and the number of shares you buy. Safaricom shares are typically affordable, making them accessible to small investors.
In addition to the share price, you should budget for brokerage fees, levies, and taxes. These costs are regulated but vary slightly depending on your broker.
Costs and Fees Involved
Every Safaricom share transaction includes several charges set by regulators and brokers. These costs are deducted automatically during the trade.
Common charges include brokerage commission, NSE levy, CDSC fees, and statutory taxes. While each fee may seem small, understanding them helps you calculate your true investment cost and expected returns.
How Long Does It Take to Complete a Purchase
Once your buy order is executed, settlement typically occurs within T+2, meaning two business days after the trade. After settlement, the shares officially belong to you and appear in your CDS account.
This settlement period is standard across the NSE and ensures both buyers and sellers meet their obligations before ownership changes.
How to Check Your Safaricom Shares
After buying Safaricom shares, you can confirm ownership through CDS statements or your broker’s trading platform. CDSC also sends SMS alerts for transactions linked to your account.
Regularly checking your statements helps you track your investment and quickly spot any errors or unauthorized activity.
Dividends and Shareholder Benefits
Owning Safaricom shares may entitle you to dividends when the company declares and pays them. Dividends are usually paid annually and credited directly to your bank account.
As a shareholder, you also have the right to attend annual general meetings and vote on key company decisions. These benefits reinforce your role as a part-owner of the business.
Risks of Buying Safaricom Shares
While Safaricom is a strong company, buying its shares still involves risk. Share prices can fall due to market downturns, regulatory changes, or company-specific challenges.
It’s important to invest money you can afford to leave in the market for the long term. Understanding risk helps you avoid panic selling during short-term price fluctuations.
Is Safaricom a Good Long-Term Investment?
Many investors view Safaricom shares as a long-term investment rather than a short-term trading opportunity. The company’s dominant market position and innovation track record support this outlook.
However, investment decisions should align with your personal goals, time horizon, and risk tolerance. No single stock is suitable for everyone, even a market leader.
Common Mistakes Beginners Should Avoid
New investors often rush into buying shares without understanding the process or the risks involved. This can lead to disappointment or unnecessary losses.
Avoid buying shares based purely on rumors or short-term price movements. Taking time to learn how the market works improves your chances of long-term success.
Safaricom Shares Through Mobile and Online Platforms
Some brokers allow investors to buy Safaricom shares through mobile apps and online trading platforms. These platforms make investing more accessible and reduce paperwork.
Even when using digital platforms, the underlying process remains the same. You still need a CDS account, a licensed broker, and sufficient funds.
Selling Safaricom Shares When You Need Cash
Selling Safaricom shares follows a similar process to buying. You place a sell order through your broker, and once matched, the proceeds are credited to your account after settlement.
Understanding how to exit your investment is just as important as knowing how to enter. Planning your exit helps you manage liquidity and investment timing.
Tax Considerations for Safaricom Shareholders
In Kenya, capital gains tax may apply when you sell shares at a profit. Dividend income is also subject to withholding tax, which is usually deducted before payment.
Being aware of these taxes helps you estimate net returns and comply with tax regulations without surprises.
Final Thoughts
Learning how to buy Safaricom shares is an essential step for anyone interested in investing in the Kenyan stock market. The process is structured, regulated, and accessible to both beginners and experienced investors.
By opening a CDS account, choosing a licensed broker, and understanding costs and risks, you can invest confidently and responsibly. Safaricom shares may not guarantee profits, but they offer a clear and practical entry point into equity investing in Kenya.
Vincent Nyagaka is the founder of Chweya, where he breaks down complex financial topics into simple insights. A trader since 2015, he uses his market experience to help readers better understand investing, trading, and personal finance.
