Category: Business Daily

Kenyan households spent Sh27.7 billion on school-related expenses for children in schools abroad in the year to May 2025, highlighting the burden families face in the pursuit of quality education abroad.

A new official survey on inward and outward remittances shows that the cash sent to scholars abroad was equivalent to 68.4 per cent of Kenya’s total remittance outflows of Sh40.5 billion in the period.

A rising number of households are sending their children to universities abroad amid concerns about the quality of education in cash-strapped and often mismanaged local institutions, and a lack of job opportunities in the Kenyan economy for graduates.

The survey that polled 4,400 households was carried out in August 2025 by the Kenya National Bureau of Statistics (KNBS in collaboration with the Central Bank of Kenya (CBK) and Financial Sector Deepening Kenya (FSD Kenya). This is the first comprehensive nationwide assessment of household remittance flows in Kenya.

The findings showed that those aged between 20 and 29 received Sh16.02 billion in cash and in-kind remittances, while the 30-39 age group received Sh16.35 billion.

Those holding secondary education before leaving Kenya received Sh20.4 billion, or 50.2 percent of total remittance outflows, indicating that the support mainly went towards catering for tertiary education needs.

‘This pattern reflects the significant financial needs of young adults abroad, including education, living expenses, and initial settlement costs for students and early-career professionals. In addition to cash remittances, individuals in this age group also received a higher share of in-kind remittances, indicating support for both personal and professional requirements,’ said KNBS in the report that was published on Tuesday.

Recipients in paid employment received Sh5.06 billion from relatives living in Kenya, split almost evenly between cash remittances (Sh2.38 billion) and in-kind goods (Sh2.67 billion).

In contrast, out of the Sh27.7 billion sent to students abroad, only Sh89.6 million was in non-monetary or in-kind goods such as Kenyan food items.

Those categorised as homemakers received Sh930.4 million from Kenya, while unemployed individuals seeking jobs abroad were sent Sh645.7 million, all of it in cash to help them meet daily needs.

The highest ratio of in-kind goods sent abroad went to those in self-employment, whose overall remittances of Sh815 million comprised Sh725.5 million in in-kind goods and just Sh89.5 million in cash.

In terms of destination countries for the outward remittances, Turkey and the US led with volumes of Sh10.07 billion and Sh8.26 billion respectively, followed by the UK at Sh6.27 billion, Uganda at Sh5.25 billion and Australia at Sh1.42 billion.

‘The high concentration of remittances to recipients in Turkey, the US, and the United Kingdom highlights the significant educational, professional, and familial connections that drive these financial flows, while substantial transfers within the EAC emphasise the enduring importance of regional support networks,’ the report added.

Overall, the inaugural report found that Kenya’s total remittance flows were higher than previously estimated, after bringing into visibility the flows transacted through informal channels and in-kind goods transfers.

Total inflows stood at Sh931.8 billion in the 12 months to May 2025, which was Sh280.6 billion higher than the Sh651.2 billion inflows that were recorded by the CBK through formal channels like banks, mobile money and remittance service providers in the period.

Some of the channels preferred by those sending money home or abroad informally include in-person delivery through self or relatives, Hawala systems or through cryptocurrencies. The main motivation for using these channels was to cut the cost of transmission, speed, and ease of access.

For those living in neighbouring countries-particularly along the Uganda and Tanzania corridors- households reported using road transporters including buses, matatus, motorcycles, and bicycles to ferry goods to their relatives in Kenya.

When Maria Mbeneka was recently nominated for the Tri-Nations Woman of the Year award for her work enabling feedlots and contracted pastoralism through technology, it prompted me to ask her about what is top of mind for a livestock sector CEO on a daily basis.

Ensuring that every single time we are getting it right at livestock sourcing, she said without hesitation. It is about making good buys by sticking to the selection criteria. Ensuring that we are getting the standard operating procedures formalised and implemented is fundamental. It is one thing to have strategy and vision, but you have to get them done.

That’s a heavy pile, what is the prioritisation? I persist. They are all there, she says. But getting the underlying systems working – establishing and sticking to them – is crucial, because there is your way of doing things and there is the effective way. When you complete a project or a cycle and you look at the steps you took to get there and you learn from the mistakes or shortcomings, then you are making progress.

You have to keep measuring the outcomes, she continues, and tracking the results to guide you because you are doing the same thing over and over again. The results assist you to set up the system.

Of course, it helps to have qualified people to do it. How do you know they are qualified, I enquire? Use referrals and headhunting to find them, comes the answer. Get people who have worked in that area before, so they come recommended or referred.

The biggest pain-point is slow adoption. Many sector participants are still very stuck on the old, manual ways and processes. Data collection has improved, from a book to a computer, but moving from traditional Word or Excel documents into the digital space, would be better still. There is adoption, but it is work in progress.

Why is that, I ask? Many don’t not yet see the full or bigger picture. They are only seeing the chore of inputting data as an additional hustle. We need to show what the additional data produces – how to use that data to improve the way we feed the animals, make decisions, right down to an individual’s output, and how that affects the success of the business.

The biggest joy is when things work out in the way they are supposed to – such as sticking to an agreed plan, and measuring whether the plan is being executed, in a routine way. We keep checking that we are doing the right thing and confirming it with the data or results we collect.

Innovation at work brings great satisfaction. For instance, when we agree to a plan and my team members tweak it, and apply themselves to get better results. It means they have understood it, and are invested in it.

Recently, when I shared the results of an offtake delivered to Choice Meats, including pictures of the carcasses, the weights and grading metrics, the team was very proud of themselves. They were proud that their work had been recognised by an established and respected processor.

Another example is while mixing feeds. The supervisor gave tips on how they are mixing and fermenting. Putting the feed mix in silage bags for a couple of days, makes the feed more palatable for the animals, and we are seeing excellent weight gains. Joy comes from finding solutions that are not necessarily expensive and you get the same or better results than if you had invested in expensive structures.

Another joy is contrasting the traditional way of doing things versus the scientific, data tested and driven solutions. Compared to the traditional approach of just grazing randomly, not measuring, not weighing until when it is required by a buyer, has shown me and my team that the scientific, data driven solutions are working. The results of using this method are translating into success. We are achieving better results within a shorter time and in a more efficient manner.

A controlled environment means we are controlling the health of the animals and using grazing and resources more efficiently. So, striking the balance between managing the resources that go into achieving that result, I think is the true test of whether or not it is a profitable way of looking after livestock. And using tech is making it more efficient, which is great!

The Business Registration Service (BRS) has introduced tighter verification of changes in company shareholding and directors as part of a strategy to curb fraud in corporate records.

Under the changes, directors and shareholders are now required to provide direct confirmation for applications involving the resignation and appointment of directors, as well as the transfer of shares.

These changes require direct confirmation from affected individuals (referred to as ‘authenticators’) to validate the legitimacy of corporate filings.

‘The primary verification method is a system-based process, where authenticators receive a One-Time Passcode (OTP) via their registered email and mobile number, along with a link to the Business Registration Service version two (v2) consent portal,’ law firm Bowmans said in a note.

‘Authenticators must log into their eCitizen account, access the transaction details, and indicate consent by selecting ‘Approved’ or ‘Declined’, followed by entry of the OTP. Approved applications proceed automatically once all required consents are obtained, while declined applications are halted,’ it added.

Where system verification is not yet implemented, email confirmation may be used. If verification through a registered email is unsuccessful, BRS may require virtual call confirmation via Zoom.

‘The updates aim to enhance due diligence, strengthen corporate governance, and prevent fraudulent or disputed changes to company records. Authenticators are required to have eCitizen accounts and maintain access to their registered contact details to avoid delays in processing,’ Bowmans said.

Under the BRS changes, where an application is lodged to resign or appoint a director, or to transfer shares, the director being appointed or resigning, or the transferor of shares (authenticator), will be required to provide direct confirmation by consenting to the company changes or transactions. The verification or consent process requires the authenticator to have an eCitizen account.

Where the authenticator(s) decline, the application will not proceed and will be marked as ‘declined’. The authenticator(s) may provide a reason for their decision.

Where the authenticator accepts, the application will be automatically approved, provided there are no outstanding consents required from other parties.

Records show that in the financial year 2024/25, the BRS registered a total of 138,000 business entities, which comprised 73,624 business names, 62,287 private companies, 52 public companies, 185 foreign companies, 894 companies limited by guarantee, 522 limited liability partnerships, 48 limited partnerships and 388 trusts. This is an additional 1,791 registrations compared to the 2023/24 financial year, or a 1.31 percent increase.

‘Across the months, a wavy trend of registrations has been experienced, subject to historical trend factors. For instance, the lowest number of registrations was experienced in the month of December (8,315) as a result of the long festivities during the month that alter the normal uptake of customer applications,’ said the BRS.

The government will extend the Treasury Single Account (TSA) framework to county governments from July, committing to a plan aimed at tightening control of public cash flows and the management of pending bills.

The rollout marks a major shift in how counties handle public money, moving away from fragmented bank accounts spread across commercial banks toward a more centralised cash management structure controlled through the National Treasury and the Central Bank of Kenya (CBK).

The reforms come as the government intensifies efforts to tighten expenditure controls, reduce pending bills, improve visibility of public cash balances, as well as easing pressure from expensive short-term borrowing amid growing fiscal strain.

What is the Treasury Single Account (TSA)?

The TSA is a unified structure of government bank accounts that allows public money to be consolidated and managed centrally instead of being scattered across multiple standalone accounts.

Under the model, ministries, departments, agencies, and now, eventually, counties, transact through linked accounts operating under a central treasury framework at the CBK.

The system allows the government to monitor cash balances in real time and optimise utilisation of available funds before resorting to borrowing.

Why is the government extending the TSA to counties?

The National Treasury says the move is intended to improve cash management, strengthen oversight of public funds, and tighten control of pending bills within devolved units.

For years, counties have operated numerous commercial bank accounts holding billions of shillings, even as suppliers remain unpaid and the Treasury borrows expensively to meet financing obligations. The fragmentation has complicated visibility over county cash positions and weakened accountability in expenditure management.

Treasury Cabinet Secretary John Mbadi says the extension will start with automation of county exchequer requisition processes before the devolved units progressively migrate into a TSA structure similar to that of the national government.

The reforms are also expected to support broader fiscal consolidation efforts as Kenya grapples with widening deficits, rising debt obligations, and constrained borrowing space.

How will county revenue collection change under the TSA system?

County governments currently collect own-source revenue such as parking fees, business permits and market charges through accounts held in commercial banks. Under the TSA system, these collections will no longer remain independently usable at department level once deposited.

Instead, revenues will be routed into a centralised structure where balances are visible and managed within the broader Treasury framework. This means counties will still collect money, but their ability to immediately deploy those funds locally will be significantly constrained.

What happens to existing county bank accounts?

Instead of functioning as independent spending accounts, county bank accounts will operate within a TSA-linked system where balances are either pooled or mirrored in real time at the CBK.

This means counties will no longer treat commercial bank accounts as standalone financial hubs.

They will instead function as controlled transaction points within a centrally monitored system, with the Treasury maintaining oversight of overall liquidity and usage patterns.

How will counties request and access funds for spending?

Under the TSA framework, counties will be required to submit formal payment requisitions through a standardised digital platform connected to the National Treasury. These requests will originate from county departments but must pass through a central validation process before cash is released.

Once a request is submitted, it is checked against available liquidity across government accounts, and approved payments are released into designated settlement accounts for execution.

How could the reforms affect counties and suppliers?

The government expects the TSA rollout to strengthen management of pending bills, which remain one of the biggest operational and political challenges facing counties.

Many suppliers have for years complained about delayed payments despite counties receiving regular exchequer disbursements from the National Treasury.

The reforms are set to improve payment tracking and reduce situations where counties hold cash in some accounts while contractors and suppliers remain unpaid elsewhere.

The transition could, however, also reduce flexibility over how individual departments manage funds, as cash utilisation will increasingly fall under centralised oversight structures.

The automation of exchequer requisitions is expected to standardise how counties request and process funds before eventual migration into the broader TSA architecture.

Why are commercial banks likely to feel the impact?

Commercial banks have historically benefited from large government deposits held by ministries, agencies and county governments across thousands of public sector accounts.

Those deposits provide banks with liquidity that can support lending, investments and treasury operations.

As public cash becomes increasingly consolidated under the TSA framework at the CBK, commercial banks could lose access to part of those balances.

The shift could particularly affect smaller banks that rely heavily on government deposits for liquidity support. The national government’s earlier TSA rollout already reduced some balances previously circulating within the banking system.

Will the TSA resolve Kenya’s public finance problems?

While the TSA can improve cash management and reduce waste linked to fragmented accounts, it does not automatically eliminate issues such as budget deficits, corruption, weak procurement practices or excessive spending. The reforms mainly strengthen visibility, coordination and control of available public cash.

Kenya still faces broader fiscal pressures driven by rising debt repayments, weak revenue collection and growing expenditure demands across both national and county governments.

Stronger cash management systems can, however, reduce unnecessary borrowing costs, improve payment efficiency and tighten accountability over public resources.

The Kenyan middle class is trapped in a paradox of privilege. We are highly educated, globally connected, and financially secure enough to afford private solutions to public failures.

When the national power grid falters, we switch on solar backups. When public water systems dry up, we call private bowsers. When public schools struggle, we pay premium tuition for international curricula. We have successfully privatised our lives, but in doing so, we have abandoned the public square.

The grand national ambitions require more than just technical blueprints. They require collective psychological buy-in. Yet, for too long, the primary contribution of our middle class to nation-building has been reduced to digital outrage.

We are champions of the WhatsApp group debate, professors of X spaces, and captains of corporate boardroom complaints. We criticise policies, lament systemic delays, and express perpetual disappointment in national leadership.

Yet, when the time comes to step up, show civic responsibility, and partner with the State to build the nation, we retreat into comfortable cynicism.

This comfortable indifference must end. If Kenya is to achieve its long-cherished dream of becoming the ‘Singapore of Africa,’ the middle class must shift from chronic complainers to active civic participants.

The comparison between Kenya’s current path and Singapore’s historic transition is not mere rhetoric. It is a blueprint built on mega-infrastructure. Singapore’s rise from a vulnerable island to a global economic powerhouse was anchored on a relentless commitment to world-class public infrastructure-its ports, airports, public housing, and industrial zones.

Today, Kenya is charting its own definitive roadmap to that first-world status through the government’s Sh5 trillion development plan. This involves massive commitments to expand highways, extend the standard gauge railway, and build smart ecosystems like Konza Technopolis.

However, hardware alone cannot transform a nation. Singapore’s mega-infrastructure succeeded because it was met with ‘software’ compatibility through a disciplined, patriotic middle class that did not sabotage national plans with cynicism, but instead protected, utilised, and optimised public assets.

In Kenya, the middle class often looks at monumental projects not as shared national victories, but through a lens of perpetual suspicion.

Every project is said to be a scheme by those in power to loot from public coffers and a way to win an election. We cannot build a first-world economy with a third-world civic mindset that dismisses foundational development as mere political theatre.

Nowhere is this civic gap more apparent than in the conversation surrounding Kenya’s energy transition.

To power modern industrial parks, sustain high-speed rail, and lower the cost of living for all citizens, Kenya requires a massive leap in baseline power.

Tax authorities worldwide are struggling to adapt traditional systems to a digital, borderless economy. Modern business models increasingly rely on cloud computing, Software-as-a-Service (SaaS), digital platforms and integrated payment ecosystems. These developments have fundamentally reshaped how value is created and where it is deemed to arise.

At the heart of this debate lies the definition of ‘royalty.’ Traditionally, royalties referred to payments made for the use of intellectual property such as patents, copyrights, trademarks, and industrial know-how.

Under Article 12 of the OECD Model Tax Convention, royalties are generally limited to payments for ‘the use of, or the right to use’ intellectual property such as copyrights, patents, trademarks, secret formulas, and know-how. Jurisdictions such as South Africa and the United Kingdom are mostly aligned with this interpretation.

The UN Model Tax Convention, which is generally more favourable to developing countries, adopts a broader source-based approach than the OECD Model. Historically, the UN Model included payments for the use of industrial, commercial or scientific equipment within the royalty definition, although this has evolved over time.

In many jurisdictions, this definition has gradually expanded to capture digital transactions that blur the line between services, access rights, and intellectual property exploitation.

Kenya has also been at the forefront of this evolution. Over the years, the Income Tax Act has expanded the definition of royalties to cover software, telecommunications infrastructure, digital platforms, and cross-border technology services.

This expansion has largely been driven by disputes between the Kenya Revenue Authority (KRA) and taxpayers, particularly multinational enterprises operating in the technology, telecommunications, financial services, and digital economy sectors.

What was once a relatively narrow and well-understood concept has become one of the most contested provisions in the Kenyan tax system. Viewed against international best practice, Kenya’s approach reflects a deliberate policy choice prioritising revenue mobilisation and source taxation over strict alignment with international consensus.

In Kenya, royalty payments are subject to withholding tax (WHT). As a result, classifying a payment as a royalty carries significant commercial implications. A broader definition translates into a wider WHT net, increased compliance obligations, and potentially higher operational costs for businesses.

Against this backdrop, disputes have intensified with the rise of software licensing, cloud computing, SaaS and digital platforms. The KRA has consistently taken the position that payments to foreign technology providers constitute royalties subject to WHT, while taxpayers have argued that such payments represent ordinary service fees, business income, or outright purchases rather than royalty-bearing transactions.

Courts have emphasised that not every software payment qualifies as a royalty. The key question is whether the payer acquired rights to commercially exploit intellectual property or merely obtained limited user rights.

In a recent case involving a technology company, the High Court ruled that payments for software licences were not royalties, distinguishing between acquiring a copyright and purchasing copyrighted material.

Similarly, in another case involving a software solutions provider, the court held that payments made to an overseas software vendor for software licences did not transfer intellectual property rights and therefore did not constitute royalties.

Another landmark decision involving a leading financial institution saw the Supreme Court rule that payments made by acquiring banks to international card service providers were not royalties and thus not subject to WHT.

Collectively, these decisions curtailed KRA’s attempts to subject all software-related and payment-processing fees to withholding tax.

Faced with repeated judicial setbacks, Parliament progressively broadened the statutory definition of royalties through successive Finance Acts. The amendments expanded the definition to include software payments, satellite transmission fees, payments for industrial or scientific equipment, and certain digital marketplace transactions.

These changes reflect Kenya’s deliberate shift toward source-based taxation, ensuring that payments arising from economic activity within Kenya remain taxable even where the recipient is a non-resident.

The Finance Bill, 2026 proposes Kenya’s most far-reaching expansion of the royalty definition. The Bill expressly classifies as royalties payments relating to proprietary digital platforms, payment networks, payment card schemes, payment processing systems, switching systems, clearing systems and settlement systems.

The Bill also significantly expands software-related royalties to include proprietary and off-the-shelf software, licence fees, development fees, training fees, maintenance fees and support fees. Further, recurring payments under software distribution arrangements would now be treated as royalties, directly addressing earlier judicial decisions that excluded such payments.

The proposed changes carry major implications for businesses. Kenyan companies making payments to non-resident technology providers, payment processors and digital platforms will face expanded withholding tax obligations.

Where contracts prohibit tax deductions, businesses may be required to gross up payments, thereby increasing the cost of technology adoption and digital transformation. These additional costs are likely to be passed on to consumers through higher transaction charges and subscription fees.

The broadened definition may also create mismatches with foreign tax systems and treaties. Some jurisdictions may not recognise these payments as royalties, raising the risk of double taxation. Disputes are expected over whether certain fees constitute royalties under treaty provisions or ordinary business profits taxable only where the recipient has a permanent establishment.

Supporters argue that the amendments modernise Kenya’s tax framework and protect its tax base in the digital economy. Critics, however, warn that excessively broad definitions may discourage foreign investment, raise the cost of digital transformation and undermine Kenya’s ambition to be a regional technology hub.

Ultimately, Kenya’s evolving royalty definition reflects a broader global trend as tax systems attempt to adapt to digital commerce faster than international consensus develops. As the digital economy continues to evolve, the debate over what constitutes a royalty continues, and the Finance Bill, 2026 suggests that the next chapter of disputes may only just be beginning.

Kenya has opened a multibillion-shilling bidding war among South Korean firms to install an intelligent transport system across Nairobi in a fresh push to reduce reliance on manual enforcement by police officers at some of the city’s busiest junctions.

The Kenya Urban Roads Authority (Kura) has restricted the contract to install smart traffic lights, automated Vehicle Enforcement Systems (VES), CCTV cameras, vehicle detector systems and Variable Message Signs (VMS) across key transport corridors in the capital to firms from South Korea.

This reflects the conditions attached to an $83.8 million (Sh10.8 billion) loan from Seoul’s Economic Development Cooperation Fund for the second phase of Nairobi’s Intelligent Transport System.

‘The design-build works, including commissioning and test operation, shall be completed within a period of 30 months from the commencement date,’ Kura, the project executing agency, wrote in tender documents on Tuesday.

‘Following the taking over of the Works, the [successful] contractor shall provide and deploy experts for a period of four years to provide operational support and to assist the employer in achieving sustainable operation and maintenance of the works.’

The planned rollout of the intelligent transport system is an attempt to use technology to tackle Nairobi’s long-standing traffic woes, which continue to cost commuters hours in delays and businesses billions of shillings in lost productivity.

Under the project, the government plans to roll out an extensive automated enforcement network designed to identify and record traffic violations without requiring officers to be physically stationed at intersections.

The Vehicle Enforcement Systems will capture offences that frequently contribute to gridlock, including motorists blocking junctions, jumping traffic lights and violating lane discipline.

The systems are expected to strengthen compliance with traffic regulations while freeing traffic police from manually directing vehicles at heavily congested intersections.

The successful contractor will also redesign and upgrade 60 junctions to improve traffic flow and accommodate growing traffic demand.

The works will also include construction of one new bridge and extension of two existing bridges to eliminate bottlenecks at critical locations.

Kenya’s top four banks last year made 6,058 new hires despite fears that increased digitisation in the sector would trigger job losses in an economy struggling with high unemployment.

Equity Group, KCB Group, Co-operative Bank of Kenya and NCBA Group reported a 36 percent jump in new hires last year compared to 2024, resulting in their total headcount rising to 35,114 from 33,305 a year earlier.

The additional staff represented hiring for expansion as well as the replacement of those who exited for various reasons, including retirement, sackings and resignations.

Banks have been riding on digitisation to cut costs, with payroll being one of the cited expenses that has been declining, with over 90 percent of transactions conducted through digital platforms.

‘There has been a realisation in the banking sector, and generally in human resource management, that automation doesn’t work well alone; there is a need for human intervention, particularly in customer service,’ said Dr Ben Chumo, the chairman of Eagle HR Consultants.

The new hires will give hope to fresh graduates with ambitions of working in the banking sector, whose shift to digital banking has seen some lenders report annual job cuts.

Standard Chartered Bank Kenya last year saw its workforce dip below the 1,000 mark to 942 following an 11-year downsizing programme attributable to the shift to digital banking.

Hiring surge vs turnover

Equity recorded the largest number of new employees as well as the highest turnover as it moved to fill gaps left by departures in a year when the lender fired staff following an ethics audit.

The bank hired 3,198 new employees last year, a figure that rivals the number employed by most mid-sized banks in the country. For example, I and M Group, with operations in five countries, has 3,601 employees.

Despite the surge in hiring, Equity’s total workforce grew by only 287 to 13,370, signalling massive departures.

The numbers indicate the bank parted ways with 2,911 employees during a year when its top management disclosed that it fired about 2,000 staff members who could not offer a satisfactory explanation for money received from clients.

The lender had issued show-cause letters to thousands of staff early last year due to suspicious transactions with customers, either through their bank accounts or mobile money platforms.

Equity did not give a breakdown of the number of employees in each of its subsidiaries, but it disclosed that it had 6,929 Kenyans on its payroll, followed by 3,293 Congolese. Uganda has the third-highest number of employees in the group with 1,348, followed by Rwanda (1,020) and Tanzania (570).

‘In 2025, Equity undertook a board-led behaviour and culture audit, a deliberate and rigorous process that reinforced the group’s commitment to integrity and accountability as non-negotiable alongside performance,’ said the firm in its latest annual report.

Equity last year adopted a policy dubbed Shared Prosperity, pledging to pay its staff 15 percent of its revenue less expenses.

The Shared Prosperity policy was meant to ensure that staff salaries grow in tandem with the bank’s performance.

The high exit rate and quick replacements indicate the large pool of unemployed talent available in the job market, which enables fast recruitment without heavy training expenses.

‘The Kenyan market is an employer’s market and the banking sector could not run short of talent because universities are offering specialised courses, churning out market-ready graduates,’ said Mr Chumo.

‘In an employer’s market, the employer does not have a responsibility to develop employees. If they need specialised talent, it is available in the streets,’ he added.

Employer’s market

KCB, with operations in Kenya, Uganda, Tanzania, South Sudan, the Democratic Republic of Congo, Rwanda and Burundi, had the second-highest number of employees at 12,090, up from 11,252 a year earlier.

The group employed 1,491 new workers last year, which saw its staff numbers rise in a year when it sold National Bank of Kenya (NBK) to Nigerian lender Access Group, which took the staff associated with NBK.

KCB recorded 511 exits during the year, down from the 951 exits reported in 2024.

The bank hired 774 new employees last year compared to 1,104 hires in 2024.

NCBA hired 595 new staff, pushing its staff numbers to 3,419 and reporting a staff retention rate of 91 percent.

Family Bank, a mid-sized lender, also disclosed the number of its new hires, which stood at 326 compared to 164 exits.

Flexible staffing

Human resource practitioners disclosed that banks were now adopting flexible contracts, which gave employees whose responsibilities were viewed as non-core to the lenders contractual terms allowing for easier separation in the event of termination.

‘Banks are now having a circular structure where employees on short-term contracts are on the outer part and the core staff at the centre. So, if the market behaves badly, it’s easier to let go of those on the outer ring,’ said Mr Chumo.

Absa Bank Kenya, whose staff numbers grew by 50 last year to 2,217, released 82 employees early this year under a voluntary early retirement programme, which cost it Sh717 million, underscoring the high cost of parting ways with permanent and pensionable workers.

On any given morning, before the first customer walks through the door, a restaurant owner is already making difficult calculations. How much did electricity cost this month? Can the business absorb another increase in supplier prices? Is it possible to retain all staff on the current payroll? Can a planned refurbishment wait another year?

These are not the conversations that attract public attention. There is rarely a headline when a neighbourhood restaurant abandons plans to expand, a pub owner cuts staff shifts to manage costs, or an entertainment venue quietly closes after years of operation.

Such decisions are becoming increasingly common. Taken individually, they appear insignificant. Taken together, they tell the story of a sector struggling under the cumulative weight of rising costs and an expanding compliance burden.

The hospitality industry remains one of Kenya’s most important economic sectors. Contributing approximately Sh1.2 trillion to the economy and supporting 1.7 million jobs, the sector sustains livelihoods far beyond the bars, restaurants and entertainment venues that customers see.

Behind every establishment is a network of suppliers, distributors, farmers, transport operators, cleaners, security personnel and countless other small businesses whose fortunes rise and fall with the industry’s performance.

Against this backdrop, the Tobacco Control (Amendment) Bill 2024 has become the latest source of concern for operators already navigating an increasingly complex regulatory environment. The debate is not about whether public health matters. It does.

The question is whether the proposed approach strikes the right balance between legitimate public health objectives and the realities facing businesses with significant compliance obligations.

Under the Bill, businesses dealing in tobacco products would be required to comply with both county and national processes. Traders would need county authorisation for tobacco-related activities while also registering with the Health ministry.

Manufacturers and importers would face additional approval requirements before introducing new or modified products to the market. For operators navigating multiple licensing and regulations, the concern is that the proposed framework adds another layer of administration without necessarily improving outcomes.

That concern is grounded in experience. Hospitality businesses already contend with a long list of obligations, from business permits and liquor licences to public health certifications, fire safety inspections, labour compliance requirements and tax obligations.

Each requirement may appear reasonable in isolation. Collectively, however, they consume time, resources and capital that businesses could invest in expansion, hiring or service improvement.

International experience offers useful lessons. Countries that have recorded success in reducing illicit tobacco markets have generally focused on stronger enforcement, supply-chain controls and structured collaboration between regulators and industry.

For many professionals in Kenya, wealth building is anchored on a salary. However, the same salary pays bills, supports family needs, services loans, and if one is disciplined, leaves a small portion to save.

And yet in a world plagued with inflation pressures, interest rate shifts and economic uncertainty, one cannot solely rely on salaried income for wealth creation. Steady wealth building calls for diversification.

While diversification is often seen as a tool for the wealthy or for those with large asset holdings, it is in fact more important for those in the early stages of their financial journey, as it protects savings, spreads risk and creates opportunities for steady growth over time.

For an emerging professional, diversification can start with identifying and taking up accessible financial products that match one’s income level. A money market fund, for example, allows money to earn competitive daily returns while remaining liquid and low risk.

Separately, fixed income funds and government securities provide predictable returns and stability, helping to smooth the effect of market fluctuations. Consider a simple example.

A professional who consistently sets aside Sh10,000 each month, allocating Sh6,000 to a money market fund andSh4,000 to a fixed income fund, would invest Sh600,000 over five years. Assuming a conservative annual return of about 11 percent, that disciplined approach could grow the portfolio to around Sh800,000.

Nearly Sh200,000 of that would come not from extra savings but from the power of compounding. Increasing the monthly allocation to Sh15,000 after a salary increase would further accelerate growth without drastically changing lifestyle. This illustrates how regular, structured investing transforms salary into capital over time.

Concentration risk remains one of the biggest threats for emerging investors. Diversification helps to counter this by spreading exposure across products that suit personal goals, be it building an emergency fund, saving or preparing for education expenses…Banks play an important role in this journey by providing access to appropriate products, guidance on how to allocate funds, and tools to track progress.

Diversification is a foundational principle of sound financial management that protects against economic shocks, increases growth potential, and instils financial discipline.