Treasury Bonds in Uganda Explained: Returns, Safety, Access
What Is a Treasury Bond?
A treasury bond is a loan you give to the Government of Uganda. The government promises to pay you back after a certain period (like 2, 5, or 10 years), with interest.
Think of it like this: you give the government UGX 1,000,000 now, and they agree to give you UGX 158,000 every year for 10 years, plus your UGX 1,000,000 back at the end.
These bonds are issued and managed by the Bank of Uganda and are one of the most trusted investment options available in the country.
Why Do People Invest in Treasury Bonds?
Many people in Uganda are turning to treasury bonds because:
- The returns are higher than what most savings accounts offer
- The investment is safe and predictable
- It is a smart way to save for big goals such as school fees, land purchase, or retirement
For example: Let’s say you’re saving up UGX 5 million for your daughter’s university fees in 3 years. Putting it in a 3-year treasury bond means you’ll earn interest each year and have a bigger amount by the time you need it.
How Much Can You Earn from Treasury Bonds?
Here is a general idea of what treasury bonds in Uganda pay:
- 2-Year Bond – around 14.75 percent return per year
- 5-Year Bond – around 16.25 percent return per year
- 10-Year Bond – around 17.00 percent return per year
Let’s say you invest UGX 1,000,000 in a 5-year bond with 16.25 percent interest:
- You would earn about UGX 162,500 each year
- Interest is paid twice a year (UGX 81,250 every 6 months)
- After 5 years, you get your full UGX 1,000,000 back
Understanding Coupon Rate and Yield (Real-Life Example) Let’s break this down with an example, like we did in the earlier guide:
- Suppose you buy a bond with a coupon rate of 14 percent. That means you will earn UGX 140,000 every year if the bond’s face value is UGX 1,000,000.
- Now imagine you did not pay UGX 1,000,000 — you got it at a discount, say UGX 950,000. You will still earn UGX 140,000 per year. Because you paid less but earn the same interest, your actual return (yield) is higher than 14 percent.
So:
- Coupon Rate = fixed annual interest based on face value
- Yield = what you really earn, based on how much you paid
This matters when comparing different bonds or deciding when to buy.
Are Treasury Bonds Safe?
Yes. Treasury bonds are considered very low risk.
Why?
- They are backed by the Government of Uganda
- You know how much you will earn from day one
- Your capital is returned at maturity
The only thing to consider is inflation. If prices rise faster than your bond return, your money might lose some value. Also, bonds are best held to maturity. Selling early is possible but may involve a price change.
How to Access Treasury Bonds in Uganda
Getting started is simpler than you think. Here is what you need:
- Be 18 or older
- Have a valid ID (National ID or passport)
- Start with as little as UGX 100,000
The easiest way to invest is through a licensed platform like Level Africa:
- Create a free account on Level Africa
- Fund it via Mobile Money or bank transfer
- Browse bonds under “Products > Treasury Bonds”
- Choose a bond that fits your goal
- If the bond is marked “Available,” you can buy it instantly. Otherwise, your order will be placed in the next auction
- Place your order and start earning
Common Questions First-Time Investors Ask
Can I lose my money?
Very unlikely. These are government-backed investments.
Can I sell my bond before it ends?
Yes, but it depends on finding a buyer. It is easier to hold until the end.
Are my returns taxed?
Yes. A 15% withholding tax is taken off your interest before you receive it.
Get Started with Treasury Bonds on Level Africa Today
Want to grow your investments while keeping your money safe?
You only need UGX 100,000 to begin. Everything is handled online. It is safe, simple, and fast. Bonds marked “Available” can be bought instantly.
Step 1: Create an account on Level Africa
Step 2: Choose a treasury bond that fits your goal
Step 3: Fund your account and place your order
Your bond starts earning the moment it is confirmed.