Category: Business Daily

Kenya has revived plans to introduce a “golden visa” programme that would grant immediate permanent residency to wealthy foreign investors, signaling a shift towards immigration incentives as the government competes for global investment capital.

The Kenya Investment Authority (Invest Kenya) says it is considering a residency-by-investment framework targeting investors who commit substantial capital, create jobs and generate exports, reviving a proposal first floated seven years ago, but never implemented.

The initiative would mark one of the biggest changes to Kenya’s investment promotion strategy, beyond tax incentives to offer long-term residency rights sought by globally mobile entrepreneurs and multinational executives.

Invest Kenya chief executive John Mwendwa said the agency is developing proposals and expects to lobby the government to establish a legal framework for the programme.

“We are exploring residency by investment,” Mr Mwendwa said in an interview. “Directionally, that’s the way investors would like it. We’ll see whether we can adopt that direction.”

He said eligibility would be tied to measurable economic impact, although the government is yet to determine investment thresholds or qualifying sectors under the proposed framework, which is still at conception stage.

“We have to have parameters that make commercial sense,” Mr Mwendwa said.

“Those decisions have to be made more holistically, possibly beyond our agency. So it’s a bit unfair for me to say ‘this is what I’m proposing’, then tomorrow it becomes something else.”

He added that any residency programme would require legislation because immigration privileges extend beyond the mandate of Invest Kenya and involve several government institutions.

The proposal revives an initiative announced in 2019 by the investment promotion agency, whose management at the time argued that high-impact investors deserved non-monetary incentives alongside conventional tax breaks.

‘If somebody has created impact and you can see the jobs created, why don’t we extend an incentive to them and say we invite them to be our citizen in three, two years?” the agency’s former boss Moses Ikiara said in November 2019.

The initiative, however, never progressed beyond preliminary discussions with the Interior ministry despite officials saying safeguards would be introduced to prevent abuse of the programme.

Its revival comes as governments worldwide increasingly compete for investment by offering residency and citizenship privileges rather than relying solely on generous tax incentives.

Countries are recognising that wealthy entrepreneurs value certainty over where they can live, work and relocate their families as much as they value corporate tax concessions.

Kenya already offers investors incentives through Special Economic Zones, Export Processing Zones and the Nairobi International Financial Centre, including tax exemptions and simplified regulatory procedures.

Mr Mwendwa said residency would complement rather than replace those incentives, making Kenya more attractive to investors seeking permanent commercial and personal ties with the country.

Unlike temporary work permits, permanent residency allows foreigners to establish firms, accept jobs and reside indefinitely without repeatedly renewing immigration documents.

Current immigration laws require foreign investors to hold a Class G Investor Permit for at least seven years before applying for citizenship through registration.

Applicants are required to have lived continuously in Kenya for at least three years immediately preceding the citizenship application, making the current pathway relatively lengthy.

Foreign investors qualify for a Class G permit by investing at least $100,000 (about Sh13 million) in an active Kenyan enterprise, alongside paying a Sh20,000 processing fee and an annual issuance charge of Sh250,000.

Permanent residency would eliminate recurring permit renewals and annual fees, reducing administrative costs for investors committed to building long-term businesses in Kenya.

Kenya would join other African countries already using residency incentives to attract international capital and high-net-worth individuals.

South Africa grants permanent residency to qualifying investors committing at least 12 million rand (about Sh94.92 million), while Mauritius offers immediate permanent residency to investors injecting at least $375,000 (about Sh48.53 million) into qualifying real estate developments.

Invest Kenya has not disclosed proposed investment thresholds, but eligibility will likely depend on investment size, employment creation and economic contribution.

That approach would distinguish Kenya’s programme from purely wealth-based schemes by rewarding investors whose projects deliver measurable development outcomes for the economy. Kenya attracted an estimated $3.2 billion (Sh413.6 billion) in foreign direct investment (FDI) in 2025, marking its strongest performance ever as investors poured money into the country’s digital economy and renewable energy amid business-friendly reforms.

Numbers released by the United Nations Conference on Trade and Development showed FDI inflows rose 37.7 percent, or $876 million (Sh113.22 billion), from revised $2.32 billion (Sh299.9 billion) in 2024.

Kenya’s fertility industry is now one of the country’s fastest-growing specialised healthcare markets, with over 15 established in vitro fertilisation (IVF) centres now operating nationwide, up from just a handful two decades ago.

IVF is a form of assisted reproductive technology where a woman’s egg and a man’s sperm are combined in a laboratory and the resultant embryo is then transferred into the uterus to establish a pregnancy.

However, rising IVF treatment costs mean that many interested patients are locked out of such procedures.

A standard IVF cycle costs around Sh600,000, covering hormone stimulation through to the pregnancy test but excluding diagnostic investigations. Depending on the patient’s condition and the treatment protocol, total treatment costs range from Sh500,000 to Sh1 million.

Patients also spend between Sh30,000 and Sh50,000 on pre-treatment lab tests, while a frozen embryo transfer using previously stored embryos costs around Sh150,000.

Most insurers that offer IVF benefits reimburse between Sh400,000 and Sh600,000, often requiring patients to make co-payments.

Meanwhile, only a handful of employer-sponsored medical schemes cover the full cost, so many patients pay for treatment.

‘There are people who want to access the service and require it but cannot afford it,’ said Wanjiru Ndegwa-Njuguna, consultant obstetrician and gynaecologist specialist in reproductive medicine at Footsteps fertility centre. ‘The economic situation has declined over the last two years, and I think that’s a big factor.’

She said interest continues to rise even as more patients postpone or abandon treatment because of cost.

At the Nairobi IVF centre, the number of IVF cycles performed each month has climbed to between 80 and 100, a figure that once represented the entire output of Kenya’s IVF industry.

Joy Noreh of Nairobi Fertility Centre attributes this growth to changing attitudes towards infertility.

‘People now know that it is not a curse. They know that it is a disease,” she said.

A study by researchers at the Footsteps Fertility Foundation found that 26.1 percent of patients at gynaecology clinics were subfertile, with around half of the cases being attributed to tubal factors and 15 percent to male factors.

Researchers said the true figure is probably higher, as stigma still causes many couples to consult traditional healers or religious leaders before visiting fertility clinics.

Separately, the Kenya Association of Urological Surgeons estimates that 10 to 15 percent of Kenyan couples experience infertility.

Doctors also report that more men are accompanying their partners for fertility assessments, reflecting a shift in perception that infertility is primarily a woman’s issue.

“Men understand that they can have fertility issues too and accompany their wives to the clinic,” said Dr Ndegwa.

She said male-factor infertility now accounts for nearly half of the cases seen at her clinic.

She further noted that patients are coming in much earlier than they did a decade ago. IVF was previously often considered only after many years of unsuccessful attempts to conceive. Today, more couples seek specialist care after just one or two years of trying.

‘When we started, it was a little bit depressing,’ said Dr Ndegwa. ‘We’d only see patients aged 40 and over, where the chances of success are much lower.’

Now, however, she says that more couples in their late 20s and early 30s are seeking treatment much sooner, because they don’t want to wait.

The local growth mirrors a global trend. The global IVF market is expected to be worth around $31 billion by 2026, growing by approximately seven percent each year until 2034.

Meanwhile, the Middle East and Africa region, which includes Kenya as one of its more established fertility markets, is expected to grow even faster, at almost 17 percent a year.

Dr Ndegwa identified two reasons why IVF remains expensive in Kenya.

First, the sector relies almost entirely on imported IVF medicines, laboratory media, equipment and consumables, meaning clinics are exposed to exchange-rate fluctuations, freight costs, and import taxes, which are passed on to patients. Kenya also has no local embryology training programme, meaning that specialists must train overseas, with the costs being recovered by clinics through treatment fees.

‘IVF is individualised. My treatment plan is not the same as somebody else’s. It’s not like buying bread, where everyone pays the same price,” said Dr Ndegwa.

He added that Kenya’s long-standing lack of a comprehensive law on assisted reproduction has also shaped investment in the sector.

For years, the absence of clear surrogacy laws attracted fertility agencies and investors, particularly after countries such as India tightened the rules on commercial surrogacy for foreign nationals.

‘I don’t think Kenya is the easiest place to invest, and I don’t think the need for IVF is greater than in other countries,’ she said.

However, this is about to change after the National Assembly passed the Assisted Reproductive Technology Bill in November last year, after more than a decade of waiting.

If enacted, it will establish Kenya’s first licensing and regulatory framework for fertility clinics, prohibit commercial surrogacy and restrict surrogacy arrangements to Kenyan citizens, thereby closing the loophole that had attracted foreign fertility tourism.

Deposits held by microfinance banks have edged up for the first time in three years, signalling a tentative recovery for a sector that has been under pressure from tight economic conditions and competition from banks and digital lenders.

Central Bank of Kenya (CBK) data shows deposits rose by 5.3 percent to Sh44.15 billion in the year ended December 2025 from Sh41.92 billion the previous year.

The latest deposits held by the 14 deposit-taking microfinance banks regulated by the CBK mark a reversal of a prolonged decline that saw customer savings fall from Sh48.65 billion in 2021 to Sh44.12 billion the following year, and further to Sh42.62 billion in 2023.

The latest rebound marks a boost for microfinance banks, which had been forced to rely more on expensive borrowings from institutions such as banks to lend to customers.

Deposits are a key source of funding for lenders, with those able to grow such funds at a lower cost being best positioned to maintain healthy margins.

Industry players attribute the stabilisation to a mix of fresh capital inflows, digital transformation and product innovation aimed at regaining customer confidence and attracting new savers.

The Association of Microfinance Institutions Kenya (AMFI-K) chief executive, Caroline Karanja, said the sector has been repositioning itself to reverse the negative narrative that had defined it in recent years.

‘What we are seeing is a lot of acquisitions and new investors coming in, which is changing the story of the sector. These investors are bringing in digital capabilities, which is a positive development for customers and institutions alike,’ she said.

Recent transactions, including the acquisition of Sumac Microfinance Bank by Nigeria-based fintech firm Moniepoint, point to growing investor interest in the segment. Other microfinance banks that have attracted new investors include SMEP, Maisha, Key (now LOLC Kenya), Century, Choice and Uwezo.

Such deals have helped inject capital, strengthen governance and accelerate digitisation, all of which are key factors in rebuilding deposit growth.

Ms Karanja noted that most microfinance banks have also met the proposed minimum core capital requirement of Sh250 million, placing them on a stronger footing to compete and expand.

She added that beyond capital, lenders are increasingly diversifying their product offerings and adjusting pricing strategies to attract deposits in a highly competitive market.

‘Our members have realised the need to diversify products and offer more competitive rates to customers. There is now more focus on what clients need and how to retain them,’ she said.

At the same time, she said regulatory reforms, including enhanced oversight and licensing frameworks, have made the sector more attractive to strategic partners, including foreign investors and fintech firms seeking entry into Kenya’s financial services market.

However, Ms Karanja cautioned that the operating environment remains strained, reflecting broader economic challenges.

‘The sector is still under pressure because the economy itself is constrained. There is limited liquidity, and that affects both savings and borrowing,’ she added.

Winners of the 2026 edition of Business Daily’s Top 40 Under 40 Women were feted onThursday with a call to leverage innovation, personal brands and influence to solve regional problems.

The 40 honorees were treated to a gala dinner at the Nairobi Serena Hotel, with a roster reflecting the philosophy of the awards, which seeks women whose ideas, actions and work are demonstrably impacting the nation.

Many of the young women professionals are emerging in the technology, medical and entrepreneurship space where they are seeking to tap markets that have previously been underserved, ignored or unknown.

NMG Chief Executive Officer Geoffrey Odundo said the Business Daily initiative, which spotlights young leaders and their potential to shape the continent, has grown into a powerful platform celebrating women in areas that will shape the future-including artificial intelligence (AI), climate and health.

‘This evening we celebrate women working at the forefront of AI, agriculture, healthcare, technology, manufacturing, disability inclusion and entrepreneurship,’ he said in remarks delivered on his behalf by NMG Chief Corporate Affairs, Marketing and Partnerships Officer Monica Ndung’u at the gala dinner.

Since its inception eight years ago, the awards have recognised more than 720 women, creating an influential alumni network of professionals, including top CEOs, driving change across industries.

Serrari Group founder and Managing Director Nancy Matimu was the chief guest. ‘Leverage the recognition and award you have been conferred tonight, use it to the maximum to strengthen your personal brand, to fortify your current summit and to launch your next summit of greatness,’ she said.

It took the judges two sessions lasting hours to sift through more than 1,000 entries, interrogating 181 of them, scrutinising their backgrounds and comparing each with competing candidates ahead of the final list that unearthed unknown gems across industries.

Ms Matimu challenged the awardees to ‘carry leadership with glamour and pride’ and not fear the responsibility that comes with visibility, saying their success would inspire younger women to pursue similar paths.

‘Strengthen your personal brands through digital platforms because social media has become an essential tool for amplifying professional influence and opening new opportunities,’ said Ms Matimu, who also sits in board of NMG PLC.

Last week’s ceremony at State House had all the trappings of a historic moment. President William Ruto signed the Sovereign Wealth Fund Act, 2026 into law, flanked by the Deputy President, the Treasury Cabinet Secretary, the Speakers of both Houses and a parade of bank chief executives.

One of the ceremony’s most striking moments was the presence of schoolchildren in uniform, brought on stage to symbolise the Act’s promise that the new fund is intended to serve future generations.

Speaker after speaker invoked Norway’s sovereign wealth fund. Kenya, they declared, had finally embraced the Norwegian model-the global gold standard for turning oil and mineral wealth into a permanent national endowment instead of allowing it to finance a one-generation spending spree.

Where will the money come from? Kenya’s recent mineral mapping has identified significant deposits of rare earths and other critical minerals. The country has also learned the cost of extracting mineral wealth without a mechanism to preserve it.

The President himself cited titanium mining in Kwale as a cautionary tale of resources depleted with little lasting benefit to future generations.

The new law establishes three windows: a Future Generations Fund, christened “Urithi Fund,” which must receive at least 30 percent of petroleum and mineral revenues and cannot be pledged as collateral or borrowed against; a Stabilisation Fund to cushion the budget during economic shocks; and a Strategic Infrastructure Investment Fund to mobilise capital for roads, energy and other national priorities.

On paper, this is a sensible three-pillar structure. It places Kenya alongside countries such as Botswana, Timor-Leste and Chile that have sought to escape the resource curse by embedding fiscal discipline in law rather than relying on political goodwill.

Yet invoking Norway also invites an uncomfortable comparison. The defining feature of Norway’s model was never the size of its fund. It was the fiscal rule-and, more importantly, the institutional independence that protects it.

Norway’s Government Pension Fund Global is managed by Norges Bank Investment Management at arm’s length from the Finance Ministry under a mandate established in law and overseen by Parliament.

The government may spend only the fund’s expected long-term real return-a ceiling initially set at 4 percent in 2001 and reduced to 3 percent in 2017 after an independent review concluded the earlier limit was too generous.

That ceiling is not merely advisory. It cannot be waived simply because the budget is under pressure. Even during the Covid-19 pandemic, when withdrawals temporarily exceeded the benchmark, the breach became the subject of public scrutiny.

Norway’s fiscal experts responded by recommending a review of the rule rather than relaxing it. The lesson is not that the rule is never tested, but that when it is, independent institutions publicly defend it instead of yielding to the executive.

Measured against that standard, Kenya’s new law resembles less an independent sovereign wealth fund than a specialised government account.

The Treasury Cabinet Secretary sits on the governing board. Withdrawals from the Stabilisation and Strategic Infrastructure Funds are governed by the fiscal responsibility principles contained in the Public Finance Management Act-the very law administered by the Treasury itself.

The Central Bank will hold and operate the fund’s accounts, but there is no equivalent of Norway’s independent investment manager: an institution insulated from ministerial direction, accountable primarily to Parliament, publishing its own performance reports and resisting imprudent withdrawals.

That is not a technical distinction. It is the essence of a sovereign wealth fund. A pool of money that the Treasury can access, subject mainly to rules it also interprets, is not fundamentally different from any other government account. It simply carries a more prestigious label and has a larger governing board.

Norway’s reputation rests not on the existence of a sovereign wealth fund but on the fact that ministers cannot simply decide they need the money more than the rules permit.

If Kenya’s Sovereign Wealth Fund is to fulfil the promise implied by its name, Parliament should not consider its work complete.

Its next task should be to strengthen the law by guaranteeing genuine operational independence from the Treasury, establishing a professional investment manager insulated from political direction, and enacting a fiscal rule with real legal force-one capable of surviving the pressures of an election-year budget.

The Kenya Bankers Association (KBA) has suffered a setback after the High Court rejected its request to have a circular by the Commissioner of Insurance banning service-based fees paid by insurance firms to subsidiaries of commercial banks suspended.

The High Court disallowed a suit filed by the sector lobby, saying the matter would best be handled by the Insurance Appeals Tribunal rather than a constitutional court.

“I find that the petitioner has approached this court prematurely. The dispute falls squarely within the jurisdiction of the Insurance Appeals Tribunal. The statutory pathway is both available and appropriate. Respect for institutional roles, statutory design and constitutional discipline requires that this court decline jurisdiction,’ the court said.

The case was based on rules affecting the insurance industry, which generated about Sh129.5 billion in gross written premiums in the first quarter of 2025, with the bankers’ lobby arguing the circular unlawfully affected bancassurance business and exceeded the regulator’s statutory powers. The association argued that the circular breached the members’ right to property.

The court struck out the petition without determining the legality of the circular itself. It held that the row was fundamentally regulatory and should first be heard through the statutory mechanism set up under the Insurance Act.

The association had sought to quash Circular No. IC and RE 03/2025 dated March 20, 2025, arguing that it was issued outside the powers of the Commissioner of Insurance under Section 73 of the Insurance Act.

The circular directed insurers and insurance intermediaries to comply with the provisions of the Act and the Insurance Regulations, which prescribe the maximum commissions payable on insurance business and prohibit payment of excess commissions.

It reinforced statutory limits under the Insurance Act and Insurance Regulations that cap commissions payable on different classes of insurance business, including 50 percent of the first-year premium for most ordinary life policies, 20 percent in the second year and 5 per cent on third to tenth-year renewals, while bond investment business attracts a maximum four percent first-year commission.

The circular also reaffirmed that insurers cannot pay brokers or agents commissions above the prescribed ceilings and that brokers cannot pass on higher commissions to agents than the insurer itself could lawfully pay.

KBA wanted the court to declare the circular unconstitutional, stop its enforcement permanently and suspend it through conservatory orders pending determination of the case.

The petition argued that the circular violated the right to fair administrative action under Article 47 of the Constitution and threatened banks’ property rights under Article 40 by affecting bancassurance operations.

In dismissing the case, the court found that the dispute arose from the implementation of the Insurance Act rather than a constitutional question requiring intervention by the High Court.

“The dispute concerns the statutory basis, formulation and implementation of the impugned circular,” the court said in the ruling.

The court said the petitioner’s claims that Article 47 had not been complied with, that the circular rested on an erroneous interpretation of Section 73 and that Article 40 rights were threatened all stemmed from the respondent’s exercise of statutory authority.

“They do not transform a regulatory disagreement into a constitutional controversy,” it stated.

The court added that elevating such a dispute into a constitutional petition “would disregard the doctrine of constitutional avoidance and would risk turning this court into the first forum for every regulatory grievance dressed in constitutional language.”

It also relied on correspondence exchanged before the case was filed.

“The applicant acknowledged that the circular largely mirrors the law, but expressed concern that its implementation would negatively affect bancassurance operations,” the court said. “These are regulatory concerns.”

In addition, the court said the letter demonstrated that the parties had failed to agree on the statutory underpinning of the circular rather than on any constitutional issue.

“That is precisely the kind of dispute the Insurance Appeals Tribunal established under Section 169 of the Act is designed to resolve,” the court said.

It described the tribunal as “a specialised body entrusted with reviewing regulatory decisions under the Insurance Act” and said bypassing it disregarded both the statutory framework and constitutional principles requiring specialised mechanisms to be respected.

The judge said constitutional adjudication should remain “a matter of last resort” where alternative legal pathways exist.

“The doctrine does not oust jurisdiction. It guides courts to decline constitutional determination where statutory mechanisms are available and adequate,” she said.

Justice Nyaundi concluded that the bankers’ association had moved to court prematurely.

“The consequence of that finding is that I will down my pen instantly. All that is left is to strike out the petition.”

Conflict is an inevitable feature of complex organisations, particularly in high-pressure, high-expectation working environments. Rather than defaulting to litigation, which may have long-term negative consequences, Kenyan law allows companies to opt for Alternative Dispute Resolution (ADR) mechanisms.

Further to this, forward-thinking organisations are moving beyond reactive dispute resolution towards embedding ADR into governance structures to prevent escalation, restore trust and drive cultural change in what is described as a Dispute System Design (DSD).

Internal conflicts carry serious reputational, financial and governance risks.

High-stakes issues such as sexual harassment, major disagreements between directors or unfair labour practices can carry devastating consequences, especially when that conflict escalates or goes public.

In today’s increasingly litigious business environment, allowing internal conflicts to go unchecked or relying solely on knee-jerk legal reactions, can carry a high price tag. What starts as a relatively minor internal dispute can escalate quickly into a public relations crisis.

When organisational disputes reveal deeper structural or cultural weaknesses, isolated interventions such as one-off town hall meetings are rarely sufficient.

ADR offers a range of solutions, including systematic negotiation, mediation and conciliation processes. DSD turns these principles into practical action by embedding ADR into a company’s governance, decision-making and accountability structures.

The result is an intentional, system-wide approach that is designed to resolve disputes at the lowest, fastest and least adversarial level first. Given the role that DSD can play in avoiding lengthy court proceedings, and preventing long-term reputational damage and financial liability, it is as much a strategic imperative as it is a legal one.

Effective DSD is about preventing, managing and containing disputes, not only as a way of resolving internal conflict but as a matter of good organisational design.

Failure to resolve an escalating conflict fairly and timeously could lead to strikes and loss of business.

Above and beyond sound risk management, DSD can go a long way in helping companies to improve, strengthen and stabilise their governance structures.

Disagreements among directors – when prolonged and poorly managed, can lead directly to internal instability, a lack of confidence in leadership teams and operational disruption. ADR processes can play a role in strengthening governance and preserving organisational cohesion.

Taking a DSD approach to corporate governance could also involve proactively appointing facilitators as objective, neutral third parties who can encourage collaborative decision-making and maintain focus on shared organisational objectives.

DSD also has its place in employee relations by providing a framework for building trust, addressing grievances constructively and fostering a positive, welcoming workplace culture.

Disputes between team members could lead to reduced morale, breakdowns in teamwork and decreased productivity. In the long term, this could in turn increase staff turnover, undermine organisational performance and ultimately have a negative impact on the bottom-line.

Incorporating mechanisms like in-house or external Ombudspersons or peer-review panels could ensure power balance and impartiality, while encouraging the buy-in and cooperation of the affected parties.

In support of this, Chief Justice Martha Koome has highlighted the value of a multi-door approach to resolution of disputes, particularly through court-annexed mediation programmes, in resolving labour disputes efficiently and effectively.

This success is reflected in a Judiciary report released in April 2024, which shows that 16,770 of the 18,162 cases referred to Court-Annexed Mediation were resolved, representing a settlement rate of 92.3 percent.

These results make a compelling case for the important role of ADR and DSD in fostering working relationships that can survive – and even thrive, in times of conflict.

Insurance and reinsurance firms have increased the share of their investments at the Nairobi Securities Exchange (NSE) to a four-year high of 3 percent, riding on a sustained equity market rally that has lifted returns.

Latest data from the Insurance Regulatory Authority (IRA) shows that the industry’s exposure at the NSE hit 3.0 percent in the quarter ended March 2026 compared with 2.1 percent in a similar quarter last year.

The rise in the share of the industry’s NSE holding came in the period their value of quoted shares rose 75.4 percent to Sh47.46 billion from Sh27.05 billion, pointing to a mix of new purchases and appreciation of existing stake.

During the review period, the NSE market capitalisation rose by 57.1 percent to Sh3.231 trillion at the end of March this year from Sh2.056 trillion in March 2025.

Long term insurers’ holdings of NSE equities jumped by 67.1 percent to Sh37.65 billion from Sh22.52 billion as that of general insurers increased by 14.5 percent to Sh3.46 billion.

IRA said the growth in quoted shares for long term insurers was primarily due to increases in holdings of ICEA Lion Life Assurance, Jubilee Life Insurance and Britam Life Insurance by Sh4.25 billion, Sh3.2 billion and Sh2.91 billion respectively.

‘Collectively, these three insurers accounted for 68.5 percent of the overall growth in quoted shares (for life insurers) during the period,’ said IRA.

During the quarter under review, the value of reinsurers’ holdings jumped 4.2 times to Sh6.34 billion from Sh1.49 billion, giving them an exposure of 5.5 percent.

At 3 percent, the industry’s share of their Sh1.607 trillion total investment at the NSE is the highest since four percent in the first quarter of 2022.

The insurers started increasing their share of investments at the NSE in the third quarter of 2025, closing at 2.6 percent from 2.1 percent in the second quarter, before rising further to 2.8 percent at the end of the year.

Their increased exposure to equities signals a strategic shift by underwriters seeking higher yields in a recovering market.

The industry’s highest exposure remains in government paper where rates had come down in the past two years as the Central Bank Rate declined.

Despite the uptick, equities still represent a relatively small portion of insurers’ overall investments, with fixed income assets such as Treasury bonds and bills continuing to account for the bulk of holdings.

Government paper accounted for 78.7 percent of long-term insurers’ investments in the quarter ended march 2026 while that of general insurers stood at 60.4 percent.

The industry had for years dialled down their exposure on the NSE. The latest holding is still well below 2014 when quoted equities took up 20 percent of the sector’s investment.

The rebound in stock prices has made equities more attractive compared to traditional fixed-income instruments.

Insurers, which typically prioritise capital preservation, are however cautiously increasing their risk appetite given the volatile nature of equities.

Kenya Commercial Bank (KCB) has lost a three-year court battle over a Sh2,050 mistaken mobile money transfer, with the court holding that banks have a duty to act promptly to preserve funds once notified of an erroneous payment.

The High Court upheld a Small Claims Court finding that KCB was negligent after failing to prevent withdrawal of the money despite receiving the customer’s complaint within minutes of the transaction.

In a judgment that reinforces the legal duty of banks to take reasonable steps to safeguard disputed funds following reports of mistaken electronic transfers, the court held that while banks cannot unilaterally reverse erroneous transfers without the recipient’s consent, they must act with reasonable diligence to preserve the funds once notified of the mistake.

Additionally, banks cannot rely solely on customer confidentiality or internal procedures where those measures delay the funds’ recovery efforts.

The dispute arose after Nakuru advocate Sammy Kamonjo Kiburi mistakenly sent Sh2,050 through M-Pesa on February 12, 2023 to the wrong KCB Paybill.

He immediately contacted Safaricom, which referred him to KCB because the money had already reached a KCB account. The court heard that Mr Kiburi called KCB’s customer care within minutes of the transaction and was assured the matter would be addressed and funds reversed within seven days. KCB issued him with a reference number acknowledging the complaint.

Seven days later, KCB informed him that the money had already been withdrawn from the recipient’s account and could not be reversed.

The bank also declined to disclose the recipient’s identity, citing customer confidentiality, prompting Mr Kiburi to sue before the Small Claims Court which ruled in his favour awarding him the Sh2,050 together with costs of the suit and interest.

The court said the decisive issue was the bank’s response after receiving notice of the error rather than the mistake itself.

KCB challenged the lower court’s judgment, arguing that Mr Kiburi’s loss resulted from his own mistake in entering the wrong Paybill number and that the bank had acted diligently after receiving the complaint.

It maintained that reversing the funds required the recipient’s consent and that it could not interfere with a customer’s account without lawful authority.

The bank told the court it escalated the complaint to its Chuka branch, where the recipient’s account was domiciled. However, it said the account was locked only after the funds had already been transferred to another mobile number through internet banking and withdrawn.

In rejecting the appeal, the High Court said the undisputed evidence showed Mr Kiburi reported the erroneous payment within minutes and KCB acknowledged receiving the complaint on the same day.

The court noted that the funds were withdrawn the following day before the account was frozen.

“The duty is not to reverse the funds unilaterally; it is to take reasonable steps to prevent the dissipation of the funds while the reversal process is underway,” Justice Joseph Sergon explained.

The court added that KCB’s internal process of escalating the complaint from its headquarters to the branch “resulted in a delay that allowed the recipient to withdraw the funds.”

It said the bank had not produced evidence showing what steps it took between receiving the complaint and the withdrawal.

On customer confidentiality, the court said KCB’s own witness admitted during cross-examination that the recipient’s identity should have been disclosed immediately after Mr Kiburi reported the mistake.

The court found that withholding those details contributed to Mr Kiburi’s inability to pursue recovery directly.

The court also rejected KCB’s argument that Mr Kiburi was contributorily negligent simply because he entered the wrong Paybill number.

“The respondent’s prompt action in reporting the mistake was made showed that he acted reasonably after the mistake was made,” the court said.

KCB also challenged the award of instruction fees because Mr Kiburi represented himself as an advocate. The court dismissed that ground, holding that the Small Claims Court awarded only costs and that any dispute over taxation should have been pursued separately.

Capital Markets Authority overhaul of board rules and a sweeping new ESG code signal that governance failures will now be treated as balance sheet risk, not reputational noise.

Kenya’s capital markets are worth about Sh3.88 trillion ($29.9 billion), having grown more than 26 percent since January.

Behind the rally is a quieter but more significant development: the CMA has overhauled the rules governing corporate boards and introduced a sweeping Environmental, Social and Governance (ESG) code, redefining governance as a financial risk rather than a reputational concern.

The CMA has approved new corporate governance regulations for market intermediaries, replacing a framework that has guided brokers, fund managers and investment banks since 2011. The reforms are aimed at preventing boards from losing institutional memory through mass retirements.

Under the new rules, no more than one-third of directors may leave at the same time, ensuring staggered transitions and greater continuity.

Boards must also maintain documented succession plans for chairpersons, committee heads and chief executives, with nomination committees reviewing them regularly before board approval.

Alongside these regulations is a draft ESG Code, currently under public consultation, which updates the 2015 Code of Corporate Governance for listed companies. Rather than treating sustainability as a standalone topic, the draft integrates ESG responsibilities into board oversight, risk management and disclosure requirements, making sustainability a core governance obligation.

The draft introduces stricter governance standards. Independent non-executive directors must comprise at least one-third of every board, with best practice recommending half. Directors of listed firms will be limited to three concurrent board positions, while chairpersons may serve on only two boards.

External auditors must rotate every six to nine years, and governance audits conducted by accredited professionals will become mandatory every two years, with findings published in annual reports.

Perhaps the most significant change is the treatment of climate risk. Boards will be required to review climate-related scenario analyses at least once every two years and assess whether business models remain resilient under different transition pathways. Climate risks must be incorporated into enterprise risk registers alongside financial and operational risks.

Executive remuneration will also face closer scrutiny, with variable pay linked to both financial and sustainability performance, supported by clawback provisions where governance failures occur.

The code assigns boards explicit responsibility for sustainability oversight and encourages recruitment of directors with ESG expertise.

Companies will have one year after the code is gazetted to comply with mandatory provisions or publicly explain delays and provide corrective timelines.

The reforms come as Kenya’s capital markets gather momentum, with stronger equity performance and renewed investor confidence.

For regulators and investors alike, the message is clear: credible markets depend not only on valuations, but also on resilient, accountable boardrooms.