Government bonds are long-term debt instruments issued by the Zambian government through the Bank of Zambia (BoZ). When you buy a bond, you are lending money to the government in exchange for regular interest payments and the return of your principal at maturity. The government uses these funds to finance infrastructure, public services, and other national development priorities.
Use our Government Bonds calculator to estimate your returns based on the current yields and your investment amount.
How government bonds work in Zambia
Since January 2024, government bonds in Zambia are issued at par. This means the face value of the bond is exactly what you pay for it. Before this change, bonds were discount instruments where you paid less than face value and the difference formed part of your return.
Under par issuance, your entire return comes from coupon payments. The government pays a fixed coupon rate every six months (every 182 days) and returns your full face value at maturity. The coupon rate is determined by competitive auction - the highest accepted yield rate becomes the coupon for that particular bond issue.
Available tenors and benchmark bonds
Tenor | Indicative Yield | Status |
|---|---|---|
2-Year | 14.25% | Non-benchmark |
3-Year | 14.50% | Non-benchmark |
5-Year | Suspended | Suspended from Q2 2026 |
7-Year | 15.80% | Benchmark |
10-Year | 16.50% | Benchmark |
15-Year | 17.50% | Benchmark |
Benchmark bonds are designated by BoZ as reference points for pricing and liquidity in the market. They are re-opened - meaning additional amounts are added to an existing bond issue - until they reach a minimum of K10 billion in outstanding face value. This builds deep, liquid issues that serve as pricing anchors for the entire yield curve.
Non-benchmark bonds (2-year and 3-year) are issued less frequently and primarily serve the government's financing needs without being central to market price discovery.
The 5-year tenor was suspended from Q2 2026 to realign the Government securities maturity profile in the medium term. Benchmark tenors are now 7, 10, and 15-year bonds.
How to buy government bonds step by step
Open a CSD account - Register for a Central Securities Depository account at BoZ. You can do this online at investorportal.boz.zm.
Have a Kwacha bank account - You need a Kwacha-denominated account at any local commercial bank. This is where your payments will be debited and coupon income credited.
Wait for an auction announcement - Bond auction dates are published on the BoZ website and in newspapers. From Q2 2026, bond auctions are conducted twice per quarter.
Submit your bid - Choose non-competitive (K1,000 to K499,999 face value, you accept the auction rate) or competitive (K500,000 and above, you specify your desired yield).
Settlement - If your bid is successful, your bank account is debited and the securities are credited to your CSD account.
Receive coupon payments - Every six months, the government pays your coupon interest directly through your registered bank account.
Maturity - At the end of the bond term, the full face value is returned to your bank account.
What you earn - worked example
Consider investing K100,000 in a 7-year government bond at a coupon rate of 15.80%.
Semi-annual gross coupon:
K100,000 x 15.80% x (182 / 365) = K7,878.36Deductions per coupon payment:
Withholding tax (20%): K7,878.36 x 0.20 = K1,575.67
Handling fee (1%): K7,878.36 x 0.01 = K78.78
Net coupon per payment: K7,878.36 - K1,575.67 - K78.78 = K6,223.91
Over 7 years (14 coupon payments):
Total net interest: K6,223.91 x 14 = K87,134.74
Total return: K100,000 + K87,134.74 = K187,134.74
Anyone can invest - businesses, individuals, foreign entities, and institutions are all eligible. There are no restrictions on who can purchase government securities.
Deductions on your coupon income
20% withholding tax - Deducted at source on each coupon payment. This is a final tax, meaning you do not need to declare it separately to ZRA.
1% handling fee - Charged per coupon disbursement to cover administrative costs.
Both deductions apply to every coupon payment, not just at maturity. Your net coupon is always 79% of the gross coupon amount.
Can you sell before maturity?
You cannot redeem bonds at BoZ before the maturity date.
You can sell your bonds on the secondary market to any willing buyer.
Contact your commercial bank or a licensed stockbroker to arrange a sale.
The price you receive depends on prevailing interest rates - if rates have risen since you bought, your bond will sell at a discount; if rates have fallen, it will sell at a premium.
The government can call 7, 10, and 15-year bonds after 60% of their life has elapsed.
Not sure whether bonds or Treasury bills suit you better? Read our comparison: Government Bonds vs Treasury Bills in Zambia.
Frequently asked questions
How often are government bond auctions held in Zambia?
From Q2 2026, bond auctions are conducted twice per quarter. Auction dates are published on the BoZ website and in newspapers. The quarterly auction calendar is available in advance so investors can plan their participation.
What is the difference between benchmark and non-benchmark bonds?
Benchmark bonds (7, 10, 15-year) are designated by BoZ as reference points for pricing and liquidity. They are re-opened until they reach a minimum K10 billion outstanding face value. Non-benchmark bonds (2, 3-year) are issued less frequently and primarily serve government financing needs without being central to market price discovery. The 5-year tenor was suspended from Q2 2026.
Can foreign investors buy Zambia Government Bonds?
Yes. There are no restrictions on eligibility. Foreign entities need a local Kwacha bank account and a CSD account at BoZ - the same requirements as local investors.
What happens when a bond is re-opened?
Re-opening adds additional amounts to an existing bond rather than creating a new one. The re-opened bond carries the same maturity date and coupon rate as the original, but the yield rate may differ based on current market conditions at the time of re-opening.