In downtown Cairo, the queue at Egypt Post is no longer just about parcels and pensions. It’s about profit — and participation.
Clutching national IDs and savings books, ordinary Egyptians are lining up for something that once felt distant and institutional: government debt. The new 17.75% “Citizen Bond” has turned post offices into unlikely financial hubs, pulling nearly EGP 350 million within its first two days.
For many, the pitch is simple. The return is higher than a typical savings account. The issuer is the state. And the access point is familiar — the neighborhood post office.
A Direct Line to the Treasury
The 18-month bond offers a net annual yield of 17.75%. But behind the attractive rate lies a larger fiscal recalibration.
Traditionally, Egypt’s Treasury has relied heavily on commercial banks to absorb sovereign debt. Banks, however, operate with built-in costs. They must park 14% of deposits as mandatory reserves at the Central Bank of Egypt — funds that earn no interest — while also protecting their own profit margins. Those layers inflate the government’s borrowing costs.
By selling bonds directly through the postal network, the Ministry of Finance effectively removes that intermediary markup. The strategy is less about spectacle and more about arithmetic: cheaper funding, broader participation.
And the urgency is real. In the first half of the 2025–26 fiscal year, interest payments swallowed 92% of public revenue. Between July and December alone, interest costs jumped 34.6% to EGP 1.26 trillion. Debt servicing has become less a budget line and more a gravitational force.
Diluting Risk, Widening Ownership
The Citizen Bond is also a diversification play.
Egypt’s banking sector holds a concentrated share of government debt. That concentration creates vulnerability: any liquidity strain in the banking system reverberates through state financing.
Opening the door to retail investors spreads the load. The “man on the street” becomes part of the sovereign balance sheet, reducing reliance on institutional channels.
And there is ample room to tap. According to data from the Central Bank of Egypt, local-currency household deposits reached EGP 7.74 trillion by the end of December 2025 — up 26.8% year on year. Retail savings account for more than 80% of all non-governmental deposits.
If even 5% of that pool migrates into direct government bonds, the funding landscape begins to shift meaningfully.
A Quiet Financial Experiment
The subscription window remains open until 8 March, but the early rush hints at a deeper behavioral change. For decades, sovereign debt sat behind institutional walls. Now it sits at a post office counter.
This is more than a yield story. It’s a structural one.
Each pound invested through the postal network is a pound that avoids banking premiums. For the state, that trims the weighted cost of debt. For citizens, it offers a higher, predictable return without market volatility.
Whether the Citizen Bond becomes a permanent feature of Egypt’s fiscal toolkit remains to be seen. But for now, the experiment is clear: shift borrowing from boardrooms to street corners — and let the public bankroll the republic, one post office receipt at a time.
