Bank of Uganda Treasury Bonds 2025: Rates, Terms & How to Invest
What Are Treasury Bonds?
Treasury bonds are long-term debt instruments issued by the Government of Uganda through the Bank of Uganda. When you invest in a treasury bond, you’re lending money to the government in exchange for regular interest payments, and the full amount is repaid at the end of the bond’s term.
Think of it as a handshake deal with the government: you give them money today, and they promise to return it with interest on a fixed schedule.
The government uses these funds for infrastructure, schools, healthcare, and other public needs. Because they are backed by the government, treasury bonds are considered one of the safest investments available in Uganda.
Why Invest in Treasury Bonds in 2025?
If you’re looking for a way to grow your money without taking big risks, treasury bonds could be a smart choice in 2025. Here’s why:
- You earn more than most savings accounts – Some treasury bonds are paying interest of up to 17% per year.
- Your money is safe – The government promises to pay you back, which makes this one of the most secure places to put your savings.
- You choose how long to invest – You can pick bonds that last 2, 3, 5, or even 10 years depending on your goal.
- It helps you reach your goals – Whether you’re saving for school fees, starting a business, or preparing for retirement, treasury bonds help you plan with confidence.
Unlike saving under your mattress or leaving money in an account that pays little interest, treasury bonds help your money grow while staying safe.
2025 Auction Schedule and Key Dates
Treasury bonds are auctioned by the Bank of Uganda roughly twice per month. Each auction offers different tenors — for example, a 3-year bond this month and a 10-year bond next month.
You can view the official auction calendar on the Bank of Uganda website or get alerts directly from Level Africa.
Treasury Bond Rates & Returns
Here are some examples of what you could earn from treasury bonds:
- 2-Year Bond – Earns about 14.75% per year
- 5-Year Bond – Earns about 16.25% per year
- 10-Year Bond – Earns about 17.00% per year
These numbers can change slightly each time the government holds a bond auction, but they give you a good idea of what to expect.
Some important terms to know:
- Coupon Rate: This is the fixed interest the government promises to pay you every year. For example, if you buy a bond worth UGX 1,000,000 with a coupon rate of 14%, you will receive UGX 140,000 in interest every year — typically split into two payments of UGX 70,000 each.
- Cut-Off Yield: This is the actual return you’ll earn based on how much you’re paying to get the bond. Let’s say the bond mentioned above has a coupon rate of 14%, but it’s sold at a discount for UGX 950,000. Even though the government still pays UGX 140,000 a year, you’re earning more because you paid less upfront. Your real return — the cut-off yield — might now be closer to 15% or more.
Let’s break it down with examples:
- Example 1: 2-Year Bond
- Coupon Rate: 14%
- You buy it for UGX 1,000,000
- You receive UGX 140,000 per year in interest
- Cut-off yield = 14% if bought at face value. If you paid UGX 980,000, your cut-off yield rises slightly to reflect the lower cost and same income.
- Example 2: 10-Year Bond
- Coupon Rate: 17%
- You buy it for UGX 950,000
- You still receive UGX 170,000 per year in interest
- Because you paid less than UGX 1,000,000, your actual return (cut-off yield) is higher than 17%, maybe 18% or more
In summary:
- Coupon rate is what the bond pays.
- Cut-off yield is what you truly earn, based on how much you paid.
Understanding this helps you compare different bonds and make the best investment choice.
How to Buy Treasury Bonds in Uganda
You don’t need to walk into a bank or deal with brokers. Here’s how you can do it in 2025 with Level Africa:
- Open an account on Level Africa (it’s free)
- Choose your bond (tenor and amount)
- Fund your wallet via Mobile Money or bank transfer
- Place your order with us on Level Africa.
- You receive confirmation and track your investment from your dashboard
You can start with as little as UGX 100,000.
Requirements and Minimum Investment
- Must be 18 years or older
- Valid National ID or Passport
- Minimum investment: UGX 100,000
- No hidden charges, no monthly fees
Risks and Considerations
Even though treasury bonds are very safe, it’s helpful to understand a few things before investing:
- You may not get your money out early: When you buy a bond, you’re agreeing to keep your money locked in until the end date (called maturity). If you want to access your funds earlier, you’d need to sell the bond to another investor — and that may not always be quick or easy.
- Future interest rates might affect your returns: If new bonds are issued in the future with higher interest rates, the bond you bought earlier may become less attractive to other investors. This mainly matters if you plan to sell your bond before it matures.
- Inflation reduces the value of money over time: If the cost of goods and services goes up faster than your bond’s return, your money may not stretch as far. Still, treasury bonds usually perform better than leaving money idle in a savings account.
Frequently Asked Questions
Can I invest from abroad? Yes. As long as you meet the KYC requirements and fund your wallet, you can invest through Level Africa from anywhere.
How do I earn interest? You receive interest semi-annually, and your principal is paid in full at maturity.
Can I access my money early? Not directly, but you can sell your bond on the secondary market. Contact our support for help.
Are the returns taxed? Yes, a withholding tax may apply. It’s typically deducted before payout.
Get Started with Level Africa
Level Africa is licensed by Uganda’s Capital Markets Authority. We help you invest securely and conveniently:
- Create an account on Level Africa, complete KYC, fund your wallet and invest in treasury bonds.
- Talk to an advisor directly via WhatsApp on 0765 972769
Ready to create wealth while you sleep?
Create an account and invest in treasury bonds on Level Africa