Category: Business Daily

For years, companies have listed in the stock market to raise capital, expand operations, invest in new opportunities or strengthen their balance sheets. While these remain important motivations, they are not the only reasons a company may choose to enter the public market. A key but often overlooked benefit for listing is institutionalisation.

The Nairobi Securities Exchange (NSE) has shown renewed momentum, reporting a 134 per cent increase in profit after tax in 2025, with the total revenue surpassing Sh1 billion for the first time.

Family Bank rang the bell at the NSE, marking the largest private sector listing at the bourse in more than 17 years. This is a milestone not just for the institution but also for homegrown corporates, raising a question that calls for greater attention: why have few Kenyan companies chosen to follow that path?

Kenya is not short of successful businesses. Over the past two decades, Kenya has seen ordinary ideas grow into extraordinary enterprises. Entrepreneurs and family-owned businesses have built companies that have stood the test of time, creating jobs, driving growth and proving that resilience and innovation can transform dreams into lasting economic impact. Despite this, relatively few have made the transition from private enterprises to publicly listed institutions.

Their hesitation is understandable. Listing is associated with increased scrutiny, heightened bureaucracy and concerns about dilution of ownership or control. In some cases, there is no pressing need to raise additional capital. If a business is profitable, growing and adequately financed, the incentive to pursue a listing may appear limited.

This perception, however, misses the deeper purpose of public markets. Building a successful business is one thing; building an institution that lasts is another. Many businesses begin with the passion and vision of a founder. But for a company to endure, it must grow beyond one person, anchored by strong governance, accountability and systems that carry the vision forward for generations.

Building a company takes vision, courage and persistence. Ensuring it thrives beyond its founders is a greater test. Many businesses reach a point they must navigate leadership transitions, ownership changes and the challenge of scaling without losing their purpose.

Others have found it difficult to attract new investors, professionalise operations or maintain momentum as they scale. The real journey is not just creating a successful business, but building an institution that can stand the test of time.

Listing can become an important step in a company’s journey from founder-led into a lasting institution. It brings greater transparency, stronger governance and accountability, giving investors confidence while helping companies build the systems needed to grow sustainably. Equally important, it provides a platform to raise capital.

For Family Bank, listing by introduction represents this next stage of maturity. Unlike an initial public offering (IPO), it is not about raising new capital or issuing more shares, but opening an institution to the discipline and visibility of a regulated market. It reflects the strength of what has already been built and a commitment to creating a bank that can serve future generations.

The conversation around capital markets often focuses on encouraging people to invest. Equally important is creating a pipeline of strong businesses ready to open their doors to public ownership.

Publicly listed businesses create opportunities for wealth creation by allowing ordinary citizens, pension funds, institutional investors and other stakeholders to participate in corporate growth. They contribute to stronger governance standards and help channel capital towards productivity. They also provide transparency.

Perhaps most importantly, they help transform private success stories into national economic institutions. That is why the significance of Family Bank’s listing goes beyond a single company joining the exchange.

The government plans to strip three agricultural parastatals of their lending powers, and instead consolidate State-backed financing for farmers under a single institution to curb misuse of public funds.

A Bill introduced in the National Assembly by Majority Leader Kimani Ichung’wah proposes to remove lending functions from the Kenya Agricultural and Livestock Research Organisation (Kalro), the Tea Board of Kenya and the Kenya Sugar Board (KSB).

If passed, the Crops Laws (Amendment) Bill, 2026 will channel all agricultural lending through the planned Kenya Agribusiness Development Corporation (KADCO) Limited, which is being created through the merger of the Agricultural Finance Corporation (AFC) and the Commodities Fund, the two State agencies that have traditionally provided agricultural credit.

‘This Bill removes those mandates and ensures that the relevant funds under the Sugar Act are channelled to KADCO for lending, completing the alignment of existing agricultural laws with the new institutional framework,’ Mr Ichung’wah says in the Bill’s statement of objects and reasons.

The proposed changes will remove provisions in existing laws that empower the three agencies to establish and manage lending schemes for farmers and other players in their respective value chains.

Traditionally, agricultural lending in Kenya has been undertaken by the AFC, which financed a broad range of farming activities, and the Commodities Fund, which specialised in lending to scheduled crop value chains such as coffee, sugar and coconut.

Read: Treasury purge fuels crash in banks’ lending to parastatals

The government has been consolidating the two institutions into KADCO as part of wider reforms aimed at reducing duplication among State corporations.

The AFC, Kalro and KSB were established primarily to regulate, promote and support the development of their respective agricultural sectors, with lending forming only one of several functions.

Kalro is responsible for agricultural research and the development of new crop and livestock technologies, while the Tea Board oversees regulation and promotion of the tea industry. The Kenya Sugar Board regulates the sugar sub-sector, including licensing, industry development and policy implementation.

Policymakers argue that concentrating lending under one institution will improve accountability, enhance access to finance and ensure public funds are deployed more efficiently in supporting agricultural production and value addition.

KSB currently runs a loans scheme through the Commodities Funds using the Sugar Development Fund(SDF), which is seeded through the Sugar Development Levy (SDL). The SDL is charged on both imported and locally produced sugar.

Every local miller pays four percent of the ex-factory price of the produce by the 10th day of the month immediately following the month when the sugar is manufactured. SDL is also payable at four percent on the cost, insurance, and freight (CIF) value of each consignment of imported sugar falling under the East African Community, Common External Tariff. CIF is an international shipping agreement that represents the charges paid by a seller to cover the costs, insurance, and freight of a buyer’s order while the cargo is in transit.

Repayment of loans through the SDL has, however, been challenging over the years, with official records indicating that borrowers had by 2024 defaulted on an estimated Sh3.7 billion. To curb the bad loans, the State has shaken up credit terms under the SDF-a development that is likely to slow down disbursements.

For example, individual sugarcane farmers tapping credit from the SDF face tougher scrutiny of their credit records as the State moves to tame runaway loan defaults running into billions of shillings.

Read: The truth about State-owned enterprises

The AFC currently issues loans to farmers at a fixed interest rate of 10 percent, making its facilities a key financing channel for small-scale and medium-scale agricultural producers.

The Bill is part of a broader government push to streamline the operations of State corporations by assigning specialised functions to dedicated agencies. By centralising agricultural lending under KADCO, the State hopes to create a single institution responsible for administering agricultural credit, improving oversight of public lending programmes and reducing fragmentation across multiple agencies.

KADCO is expected to serve as the government’s principal agricultural development finance institution, providing loans to farmers, cooperatives, agribusinesses and processors across various value chains.

Policymakers argue that concentrating lending under one institution will improve accountability, enhance access to finance and ensure public funds are deployed more efficiently in supporting agricultural production and value addition.

The State paid oil marketers Sh7.9 billion for the fuel subsidy scheme last month, helping ease cash flow woes that had hit the industry amid high operational costs.

Kello Harsama, the Principal Secretary in the State Department of Petroleum, said the money was paid to importers who will then pay the respective oil marketers based on the volumes lifted.

The payment, which was for the May 15-June 14 cycle, will significantly boost an industry that has in the past few months struggled due to cash flow hitches tied to the subsidy arrears.

A combination of the arrears and costly fuel in the wake of the US-Israel war on Iran made it difficult to lift sufficient volumes of fuel, leading to shortages, which were more pronounced in May.

‘Two weeks ago, we paid Sh7.9 billion for the subsidy arrears of the May-June cycle. We expect the importers to wire the money to the respective oil marketers,’ Mr Harsama said.

‘We now have an obligation to settle the arrears for the June-July cycle.’

This means that the unpaid subsidy money is the Sh10 billion for the current monthly cycle, which lapses on July 14.

Oil marketers had in May warned that the piling subsidy arrears had squeezed the industry’s ability to purchase fuel that became costly in the market shocks tied to the US-Israel war on Iran.

Read: Oil marketers protest over unpaid diesel subsides

Dealers who operate stations for Vivo Energy Kenya and Rubis Energy Kenya and dozens of small marketers were hit hard since April, with the erratic supplies triggering panic buying by consumers wary of missing out on fuel.

Prices of diesel, petrol and kerosene skyrocketed in March due to the supply and transport hitches caused by Iran’s attacks on oil refineries in the Gulf region and a blockade of the Strait of Hormuz, where nearly a quarter of the world’s fuel transits.

Besides paying for costly fuel, oil marketers are also required to pay taxes upfront before accessing fuel from the Kenya Pipeline Company (KPC) system for sale in the local market. These two became increasingly difficult due to the cash flow woes.

The subsidy kitty is funded by the Petroleum Development Levy (PDL) of Sh5.40 per litre of diesel and petrol and Sh0.40 per litre of kerosene.

Illegal diversions of money to cater for items outside those contained in the regulations governing the use of the PDL kitty and steep subsidies have nearly depleted the Petroleum Development Levy Fund (PDLF).

Read: New Sh10bn fuel subsidy piles cash flow pressure on marketers

The subsidy has been critical in preventing pump prices from rising by higher margins in the wake of the US-Israel war on Iran that led to record-high prices of refined fuel.

For example, diesel and petrol prices could have jumped by Sh64.92 and Sh33.37 per litre in the monthly cycle from April 15 had the State not subsidised prices and cut value added tax (VAT) from 16 percent to 13 percent. They rose by Sh40.30 and Sh28.69 per litre of diesel and petrol, respectively.

In the current prices to July 14, a subsidy of Sh34.07 per litre of diesel helped lower prices by Sh10 to Sh222.86. The State did not subsidise petrol prices.

Absa Group of South Africa will accept all offers of 10,000 shares and below for each shareholder in its purchase of an additional 16.5 percent stake in Absa Bank Kenya, sparing small investors the pain of rejected offers in case of an oversubscription.

The lender is purchasing 895.9 million shares through the tender at a fixed price of Sh34.50 per unit, valuing the transaction at Sh30.9 billion. If fully subscribed, the purchase will see Absa Group’s shares in the Kenyan unit rise from 3.72 billion shares to 4.61 billion units, raising its percentage stake from 68.5 percent to 85 percent.

The offer, which opened on June 30, will close on August 11.

Absa Group says in its offer document that the pro-rating in case of an oversubscription will kick in at 10,000 units, which at the offer price values the shares at Sh345,000.

In case of an oversubscription, all shareholders would first get the guaranteed minimum allocation, before those offering shares above the threshold are allotted shares in proportion to the size of their tender.

‘Each Shareholder who tenders 10,000 ordinary shares or fewer in the tender offer shall receive guaranteed acceptance in full for all such ordinary shares tendered,’ said Absa Group in the offer document.

‘Where a shareholder tenders more than 10,000 ordinary shares, the first 10,000 shares shall be guaranteed in full, and the balance shall be subject to pro-rata allocation amongst all shareholders who have tendered more than 10,000 shares.’

Read: Absa Group offers Sh31bn for extra 16.5pc stake in Kenya unit

The Nairobi Securities Exchange-listed Absa Bank Kenya had 49,164 shareholders with holdings of 10,000 shares or less by the end of 2025, its latest annual report shows. They held an aggregate of 103.18 million shares or 1.89 percent of the lender’s 5.43 billion issued shares.

Another 16,501 investors owned between 10,001 and 100,000 Absa Kenya shares, amounting to a total holding of 475.6 million units or 8.76 percent of the bank. Those holding between 100,001 and one million shares numbered 950, with an aggregate stake of 4.81 percent or 261.23 million shares.

The bulk of the lender’s shares are in the hands of the 156 owners who hold above one million units each. This group, whose participation is key to Absa Group hitting its tender target, held 870.6 million shares.

The guaranteed uptake of small investors’ stakes is likely to encourage such shareholders to participate in the offer, especially if they are in line to make a significant capital gain on the stock whose price has gone up by 33 percent this year to close at Sh32.80 on Friday.

Absa Group noted that its offer of Sh34.50 per share represents a premium of 18.1 percent compared to the closing price of Sh29.20 on June 17, 2026 –the last day on which the Kenyan subsidiary shares traded before the bid by the multinational for extra shares was filed.

It also represents a premium of 39.7 percent to the December 31, 2025 traded price of Sh24.7 and 79.7 percent to the June 30, 2025 closing price of Sh19.20.

In raising its stake, the South African lender is eyeing a larger slice of the subsidiary’s growing dividend payouts, in addition to pushing its broad strategy of deepening its presence in high-potential markets in Africa.

Since the split and rebrand of the Kenyan unit from Barclays in 2020, net earnings have grown from Sh7.4 billion (in 2019) to Sh22.9 billion last year, allowing the unit to raise its annual dividend from Sh6 billion to Sh11.1 billion in the period.

It is the second major South African bank making a bid for enhanced presence in Kenya, with an eye on using it as a springboard for the larger East African market.

Absa Group’s rival Nedbank is spending Sh110 billion to buy a 66 percent stake in NCBA Group, Kenya’s fifth largest lender by assets, in a cash and stock offer that was filed on January 21, 2026.

In the transaction, NCBA shareholders can tender 66 percent of their holdings to Nedbank. Out of this pool of shares, 80 percent of the units will be converted into Nedbank shares at a rate of 4.02994 shares for every 100 shares. The Nedbank shares are priced at 250 rand (Sh1,928.5) using the deal’s exchange rate.

The remaining 20 percent of the shares will be bought in cash at a rate of Sh2,100 for every 100 shares or Sh21 apiece.

NCBA investors holding up to 7,519 shares will only receive a cash payout of Sh105 per share for the stocks they will sell, equivalent to a maximum of about Sh789,495.

Limiting small investors to an all-cash option makes it easier for them to realise the value of their shares, since converting a small portfolio of NCBA shares into Nedbank stock is likely to be uneconomical owing to the impact of taxes, commissions and bank charges on foreign income and transactions.

NCBA had 11,912 shareholders with holdings of between one and 500 shares as of December 2025, while 13,389 investors had portfolios ranging from 501 to 5,000 shares. Another1,853 of the bank’s shareholders held between 5,001 and 10,000 shares.

Centum Investment Company and Mi Vida Homes are in a race to raise funds from the country’s first real estate asset-backed security in the private sector as the two firms grapple with the pressure of inadequate long-term capital that aligns with the reality of property investments.

An asset-backed security (ABS) refers to a financial instrument that is backed by a pool of income-generating assets, such as rental income from housing units, allowing both institutional and retail players in the capital market to invest and therefore deploy long-term capital into it.

The pioneer ABS was in July 2025 when the government raised Sh44.79 billion from debt investors who will be paid an annual interest of 15.04 percent from future revenues from the Talanta Stadium.

Centum and Mi Vida, which are major institutional real estate investors, say that a key challenge they are facing in executing housing projects at scale is in aligning what is predominantly short- to medium-term capital with typically long-term investments in property.

‘From site acquisition to when proceeds from projects hit our income statement takes about four years. So, our income statement for 2026 is a reflection of the activities we engaged in four years ago, which is 2022. There is an opportunity in this market to develop financing products that are tailored to the nature of real estate’s operating model, and our markets are yet to mature to that level,’ Mi Vida CEO Samuel Kariuki said.

While the government has been successful in issuing up to 30-year bonds, debt investors have preferred to lend on a shorter-term basis to the private sector through instruments such as bank deposits, commercial papers and corporate bonds maturing in less than 7 years.

‘The expansion of this sector will require deployment of capital and, by and large, the capital available is short-term, and so you don’t have the luxury of borrowing for 15 years because what you are getting is three or four years’ money,’ Centum’s CEO James Mworia said.

‘Asset-backed securities are going to be a very effective tool of connecting long-term capital to housing and infrastructure assets provided those assets have reached cash generative status.’

Read: Mivida Homes enters luxury market with Sh5.6bn project

Going the route of asset-backed securities would mean the two players design ways through which receivables from cash-generative properties are securitised and used to provide backing for instruments that then go to market in capital raising.

Real estate players have in the recent past been active in diversifying their capital-raising avenues, with issuance of Real Estate Investment Trusts (REITs) gaining popularity in the recent past.

In June, Centum’s affiliate Two Rivers International Financial Centre raised Sh3.99 billion through a green US dollar-denominated income REIT, registering a 103.3 percent subscription.

In January, Africa Logistics Properties (ALP) raised Sh4.5 billion through a US dollar-denominated REIT in a restricted issuance that registered 115.0 percent in overall subscription.

Both Centum and Mi Vida argue that adding asset-backed issuances will go a long way in further diversifying how players in the real estate sector can raise capital and address the mismatch between short-term capital and long-term returns.

‘We are always thinking about this, and Centum is looking very closely at the asset-backed security space because today when you go to raise capital internationally, Africa is considered to be risky and that means we don’t have access to long-term capital,’ Mworia said.

Mr Kariuki noted that Kenya has only seen budding examples of what could look like asset-backed arrangements, noting that the very lack of many issuers of this type of debt is a challenge to going big with such financing.

‘The easiest form we have seen tending towards this is in the Tenant Purchase Scheme arrangements, but one could argue that they could have securitized that receivable,’ he said.

‘We have toyed with a product that says the developer originates the Tenant Purchase Scheme, but because they cannot hold that receivable on their balance sheet for long, they are allowed to securitise that. You realise that by the time it is a Tenant Purchase Scheme, the housing unit is ready, and one can securitise based on the backing of that housing unit.’

According to data from the National Bureau of Statistics, real estate accounts for 8.2 percent of the country’s Gross Domestic Product (GDP), placing the total market value at Sh1.43 trillion at December 2025.

The real estate sector registered 3.9 percent year-on-year growth in 2025, marking the third consecutive year of deceleration in growth momentum, having moderated from 7.3 percent in 2023 and 5.3 percent in 2024.

The World Bank has set more than 10 conditions to unlock a new round of funding for Kenya, including the disclosure of the personal interests of public officials and the publication of regulations to restrict unsolicited public-private partnership (PPP) deals, such as the flopped proposal by the Adani Group to upgrade the Jomo Kenyatta International Airport (JKIA).

Kenya has access to a third instalment of funding under the World Bank’s Development Policy Operations (DPO) programme to help plug its budget deficit if it meets the multiple conditions. The DPO is a fast-disbursing loan facility for developing countries that provides direct budget support tied to the implementation of key policy and institutional reforms, including fiscal consolidation and climate action.

The World Bank approved Sh97 billion ($750 million) in financing to Kenya last week, the second of three operations, after initially disbursing Sh155 billion ($1.2 billion) in June 2024.

Disclosure push

To secure the next disbursement, Kenya faces a series of demands from the World Bank. For example, it will have to enact the proposed Whistleblower Protection Act, which seeks to ensure fair competition, value for money and increase the detection of misused funds.

The adoption of the law is expected to anchor declarations of personal interests by public officials, reviewed and verified by the responsible commissions, from a baseline of zero to 85 percent by 2028.

Kenya is also expected to publish PPP regulations to curb unsolicited project proposals, commonly known as Privately Initiated Proposals (PIPs). A PIP is an unsolicited technical and financial proposal submitted by a private entity to the government to develop an infrastructure or public service project.

The World Bank previously cautioned Kenya against unsolicited PPP deals following the cancellation of proposed Sh2.7 billion contracts linked to Adani Group companies for the JKIA upgrade.

The multilateral has expressed concern that PIP deals could undermine public confidence in the search for private investors to build infrastructure and trigger backlash, including street protests.

Read: World Bank warns Kenya on secret Adani-type deals

The World Bank has urged Kenya to pursue competitively sourced PPPs amid concerns that unsolicited deals are shrouded in secrecy, leading critics to argue that they do not offer taxpayers value for money.

‘I think with PPPs, it’s very clear. International good practice leans on competitive tendering, and I think the same applies to Kenya,’ Marek Amush, the lead economist for the World Bank’s economic policy division in Kenya, said previously.

‘Going forward, the country’s success in PPP projects will depend on putting in place good governance, oversight, planning and accountability… including strengthening practices around unsolicited project proposals to foster predictability and confidence in PPP project development,’ the World Bank said in its December 2024 Kenya Economic Update report.

The World Bank, however, views PPPs as key to helping Kenya close its infrastructure gap.

Kenya must also meet multiple other conditions to continue accessing financing under the World Bank’s DPO programme, including amending the Companies Act, 2015 to align the beneficial ownership registry with updated Financial Action Task Force (FATF) standards.

The multilateral also requires changes to the Public Finance Management (PFM) Act to ensure that any budget adjustments during implementation are strictly aligned with the fiscal aggregates approved by Parliament.

Kenya must also consolidate human resources and payroll data for all ministries, departments and agencies, counties, non-commercial State corporations, commissions and independent offices.

Reform agenda

The first set of conditions for the third DPO disbursement seeks to promote the efficiency, transparency and equity of public finance, while the second aims to foster more competitive and inclusive product and labour markets.

The final set of conditions focuses on strengthening climate action and includes the enactment of the Railways Bill, as well as regulations for the urban transport policy and the e-mobility policy.

Under this pillar, Kenya must also integrate green building standards into the Kenya Affordable Housing Policy and adopt the Green Building Standard, which establishes mandatory minimum performance requirements for new buildings and major renovations.

The country had to meet a related set of conditions to unlock the latest World Bank funding.

Kenya’s efforts to meet three pending conditions at the eleventh hour helped it secure a Sh97 billion ($750 million) World Bank loan last week, ending a freeze that had been in place for nearly two years.

The World Bank Group approved the funding on Tuesday as part of the second Kenya Fiscal Sustainability and Resilience Growth Development Policy Operation (DPO), which supports reforms aimed at making public resources more transparent, efficient and equitable while reducing corruption.

Last-minute reforms

The country met at least two of the three pending conditions in the past month, including passing amendments to the Forest Conservation and Management Act on May 29 and publishing the sovereign sustainability-linked financing framework in late June.

The State Department for Social Protection also submitted the Social Protection (General) Regulations, 2026, to Parliament at the end of April – the remaining condition required to unlock the funding.

On April 23, the World Bank Group identified the three reforms as outstanding as it maintained the freeze on the Sh97 billion ($750 million) loan, which had initially been expected in the 2024/25 financial year.

The approved financing comprises a Sh44 billion ($340 million) loan from the International Bank for Reconstruction and Development (IBRD) and Sh53 billion ($410 million) in highly concessional financing from the International Development Association (IDA), part of the World Bank Group.

Kenya risked missing out on the funding for a third consecutive year had it failed to meet the three prior actions.

The National Treasury published the delayed sovereign sustainability-linked financing framework in the final week of June, aligning cheaper borrowing costs with commitments to reduce forest cover losses and improve rural electrification.

The framework helped clear the final hurdle for the World Bank financing while laying the groundwork for the issuance of sustainability-linked bonds (SLBs) and loans.

Kenya had initially planned to raise Sh64.7 billion ($500 million) from its debut sustainability-linked bond (SLB) in the 2025/26 financial year.

The World Bank will help underwrite the issuance by providing a guarantee of a similar amount for the expected sustainability-linked loan (SLL), which will take the form of a syndicated commercial loan.

Forest reforms

President William Ruto signed amendments to the Forest Conservation and Management Act, 2016 on May 29, strengthening Kenya’s forest governance and climate action.

Among the landmark reforms is the establishment of the Directorate of Forest Regulation, Kenya’s first dedicated forest regulator responsible for developing national standards, operational guidelines and compliance mechanisms within the sector.

The law also enhances the role of the Kenya Forest Service (KFS) in ecosystem management, technical support and collaboration with county governments and local communities.

Additionally, it promotes agroforestry and off-reserve tree growing as part of efforts to achieve the national target of growing 15 billion trees by 2032.

Funding returns

The fresh disbursement marks the return of multilateral funding after both the World Bank and the International Monetary Fund (IMF) failed to disburse funds to Nairobi in 2025.

The World Bank froze the same disbursement in the 2024/25 financial year after Kenya failed to pass seven laws and four policy reforms.

Kenya has since last year missed out on IMF and World Bank funding and has largely relied on domestic borrowing to plug its fiscal deficit.

The World Bank funding will be timely in helping Kenya bridge its fiscal deficit as the country continues discussions with the IMF on the scope of a funded programme for the 2026/27 budget cycle.

The World Bank’s financing flows directly into the budget to support government expenditure, including the payment of civil servants’ salaries.

The funding will also be crucial as Kenya deals with the effects of the US-Israel war on Iran, which has weakened macroeconomic conditions, including growth and revenue projections.

The World Bank expects the financing to help reduce revenue leakage and generate savings for the Exchequer.

‘By supporting reforms to address conflict of interest, strengthen procurement systems, improve public financial management, and expand social protection, this operation will help Kenya reduce leakage, generate fiscal savings and ensure that public resources deliver better results and reach the people who need them most,’ said Qimiao Fan, World Bank Division Director for Kenya.

‘It is also helping establish the foundational business-enabling environment that is necessary to support higher and more inclusive growth and for the private sector to create jobs.’

The Kenya Revenue Authority (KRA) has launched the third cycle of its tax amnesty programme, offering millions of taxpayers a fresh opportunity to clear historical tax liabilities without paying penalties, interest or fines while helping the government recover much-needed revenue.

The six-month programme, which runs from July 1 to December 31, 2026, was reintroduced through the Finance Act, 2026. It grants a 100 percent waiver of penalties, interest and fines on tax debts accrued up to December 31, 2025, provided taxpayers meet the stipulated conditions.

The initiative builds on two previous tax amnesty programmes that enabled KRA to recover Sh80.9 billion in principal tax while regularising thousands of taxpayers who had fallen out of the tax system.

‘The amnesty window opens on July 1, 2026 and closes strictly on December 31, 2026,’ KRA said on Friday.

‘This builds on the success of the previous two amnesty cycles, which successfully recovered Sh80.9 billion in principal tax payments while regularising thousands of taxpayers.’

Who qualifies?

The programme comes days after the June 30 annual tax return filing deadline, offering relief to taxpayers who failed to file returns on time, partly because of intermittent disruptions to KRA’s iTax platform.

Taxpayers with no outstanding principal tax but who incurred late filing penalties will automatically receive waivers once they submit all outstanding returns.

Similarly, taxpayers who had fully settled their principal tax liabilities by December 31, 2025 will automatically qualify for a waiver of all related penalties and interest without submitting a formal application.

Those with unpaid principal taxes can still benefit by settling the outstanding amount during the amnesty period, after which the related penalties and interest will be written off.

Taxpayers unable to make a lump-sum payment may instead apply for a structured payment plan through the iTax system. However, all principal tax must be paid by December 31, 2026 to qualify for the waiver.

Tax liabilities arising on or after January 1, 2026 are excluded from the programme and remain fully payable.

Revenue boost

The latest amnesty is the third since Kenya introduced tax forgiveness programmes to improve voluntary compliance, widen the tax base and recover revenue that might otherwise remain tied up in disputed or dormant tax accounts.

While the immediate objective is to ease the financial burden on businesses and individuals with accumulated penalties, the government also views the programme as a key compliance tool.

Rather than relying solely on enforcement, the amnesty is intended to encourage taxpayers to regularise their affairs, update their tax records and return to the formal tax system, ultimately expanding future revenue collection.

The programme also comes as pressure on revenue collection intensifies.

Despite growth in collections, KRA has consistently fallen short of its ambitious revenue targets. By the end of March 2026, the authority had collected Sh2.038 trillion against a target of Sh2.122 trillion, leaving a shortfall of about Sh84 billion. Exchequer revenue stood at Sh1.834 trillion against a target of Sh1.921 trillion.

The latest tax amnesty is expected to complement KRA’s broader compliance strategy at a time when the government has avoided introducing major new taxes ahead of next year’s General Election.

KRA has urged taxpayers to take advantage of the six-month window rather than wait until the deadline, warning that penalties and interest will once again become payable in full after December 31, 2026.

The authority has also encouraged taxpayers involved in active disputes to use its Alternative Dispute Resolution framework to settle principal tax liabilities and qualify for the amnesty.

South Sudan has flagged illegal fuel shipments from the port of Mombasa as Kenyan oil marketers bypass its Government-to-Government (G-to-G) deal.

Correspondence seen by Business Daily shows that Juba warned oil marketers on June 24 that fuel shipped outside the G-to-G framework risks being impounded, while companies involved face licence revocation.

South Sudan currently imports fuel under a G-to-G arrangement in which Kenya’s Pacific Petroleum is the designated importer of petrol and diesel. The company then supplies licensed oil marketers operating in the country’s retail market.

Pacific Petroleum admitted that it imported more expensive fuel cargoes outside the G-to-G framework following supply disruptions triggered by the US-Israel conflict with Iran.

The costlier cargoes have prompted other oil marketers to divert fuel originally destined for the Democratic Republic of Congo to South Sudan in an attempt to sell cheaper products.

‘We would like to inform all OMCs (oil marketing companies) to comply and lift stocks nominated as per the signed SPAs from the supplier as we finalise the South Sudan Energy that will immediately take up the role and communications in future,’ Santino Dau, Undersecretary at South Sudan’s Ministry of Petroleum, said in a letter dated June 24, 2026.

‘We are working with all security apparatus to ensure the border is manned and regulated going forward. Any stocks not originating from the manifest of stocks imported for South Sudan shall be impounded at the border. Any sabotage to this arrangement will be met with legal action and licence revocation.’

A memo seen by Business Daily shows that one of the disputed cargoes was priced at $1,350 per cubic metre of diesel and $1,000 per cubic metre of petrol.

Kenyan oil marketers licensed to operate in South Sudan say those prices are uncompetitive, arguing that the premiums differ from those agreed under South Sudan’s G-to-G arrangement.

Logistics hurdles

A separate letter from Kenya’s Ministry of Energy and Petroleum shows that Pacific Petroleum has recently faced challenges evacuating products from the Kenya Pipeline Company (KPC) system and Gapco terminals. Gapco is owned by TotalEnergies Marketing Kenya.

The difficulties prompted Petroleum Principal Secretary Kello Harsama to convene a meeting with oil marketers to address the bottlenecks.

‘In the recent past, Pacific Petroleum has faced several challenges in the implementation of the import arrangement, notably slow evacuation of product from the Gapco terminal and the KPC system,’ Mr Harsama said in a letter dated June 22, 2026.

‘To this end, we wish to invite you (seven oil companies) to a joint SDP, KPC and Epra meeting to deliberate on the most efficient way of handling the RSS import arrangement without negatively impacting the Kenyan Government-to-Government import framework.

The seven companies invited to the meeting were Pacific Petroleum, Be Energy, Asharami Synergy, Galana Energies, One Petroleum, Oryx Energies and Gulf Energy, all of which import fuel under Kenya’s G-to-G arrangement.

Kenya imports fuel through State-owned suppliers Saudi Arabia’s Aramco Trading Fujairah FZE, Abu Dhabi’s ADNOC Global Trading Ltd and Emirates National Oil Company Singapore Ltd.

Mr Harsama did not disclose the reasons behind Pacific Petroleum’s difficulties in evacuating products from KPC and Gapco facilities.

The delays suggest that nominated cargoes for South Sudan are not being lifted as scheduled.

A memo circulated to oil marketers shows that South Sudan has frozen requests to amend quantities allocated under the import programme.

‘Kindly note that KRA (Kenya Revenue Authority) has received a memo that amendments relating to South Sudan should not be approved at this time,’ the memo said.

Regional shift

South Sudan is the third East African country to adopt a G-to-G fuel import arrangement in a bid to improve supply security and cushion consumers from volatility in global spot markets.

Kenya introduced its G-to-G framework in March 2023 through agreements with three Gulf suppliers. Uganda followed a year later with a deal involving Vitol Bahrain, while South Sudan adopted its arrangement in March this year.

Rwanda became the fourth country last month after announcing a G-to-G agreement with Oman’s OQ Trading.

South Sudan has said its State-owned South Sudan Energy will assume the importer role from Pacific Petroleum. Rwanda has also established a State-owned entity to manage its fuel imports, while Uganda imports fuel through the Uganda National Oil Company.

The regional shift has increasingly concentrated fuel imports in the hands of State-backed entities, replacing the previous system under which dozens of oil marketers competed to import cargoes through open tenders.

The long-running dispute over the planned sale of Nairobi’s 14 Riverside complex has taken a fresh turn after Synergy Industrial Credit sued I and M Bank and one of its senior executives, seeking Sh5.77 billion in damages for allegedly frustrating its efforts to recover a court-awarded debt.

In a suit filed at the High Court, Synergy accuses I and M Bank and its executive director, Sarit Suresh Raja Shah, of twice blocking the forced sale of the property, preventing the Synergy from enforcing a decree against Cape Holdings Ltd, the owner of the mixed-use development.

The claim is founded on the Marex tort, under which Synergy argues that the bank intentionally interfered with its ability to realise the fruits of a judgment that has remained unpaid since 2021.

According to the suit, I and M engaged in what Synergy describes as ‘abusive litigation’ aimed solely at delaying or blocking execution of the decree.

‘For a period of 1,652 days, the plaintiff was unlawfully hindered, delayed, stopped and prevented from enforcing and realising the fruits of the decree,’ the suit states.

Synergy argues that the delays denied it the benefit of the judgment and caused losses amounting to Sh5.77 billion.

The dispute stems from an arbitration award arising from a failed property transaction. Synergy says it paid Cape Holdings Sh750 million to acquire part of the 14 Riverside development, but the deal collapsed.

An arbitrator in 2015 ordered Cape Holdings to pay Synergy Sh1.6 billion plus interest. According to Synergy, the amount outstanding had risen to Sh11.3 billion as of June 30, 2026.

Court documents show that the decretal amount stood at Sh5.13 billion on October 12, 2021. By April 21, 2026, when I and M withdrew an application seeking a review of a Court of Appeal judgment, the amount had increased to Sh10.9 billion.

Synergy says the difference between the two figures – Sh5.77 billion – represents the losses it suffered because the bank unlawfully delayed execution of the decree.

Property battle

The latest suit is the latest chapter in years of litigation over the ownership and proposed sale of the 14 Riverside complex.

I and M Bank had initially stopped the auction after arguing that it held a charge over the property securing a Sh2.82 billion loan advanced to Cape Holdings. The bank maintained that the court first needed to determine which creditor had priority over the asset before any sale could proceed.

That case was eventually dismissed. The bank later sought a review of the Court of Appeal decision before withdrawing the application in April this year.

A November 2020 valuation by Knight Frank placed the property’s market value at Sh7 billion and its forced-sale value at Sh5.25 billion. The auction, however, never took place.

Synergy now claims that by placing Cape Holdings under administration in October 2021, I and M triggered the statutory moratorium under Section 560 of the Insolvency Act, freezing enforcement proceedings and preventing recovery of the debt.

Synergy alleges that the bank used the insolvency process as a litigation strategy rather than a genuine corporate rescue mechanism.

According to the suit, I and M relied on a debenture registered on January 8, 2021 after advancing financial facilities to Cape Holdings, before placing the company under administration.

Loan questions

Synergy also challenges the legitimacy of the lending arrangement.

It says the debenture was based on a September 23, 2020 letter of offer indicating that I and M was taking over existing facilities previously held by Co-operative Bank of Kenya for Nandlal and Company Ltd.

However, Synergy alleges that no genuine takeover took place. Instead, it claims the funds were disbursed directly to Cape Holdings in October 2020, contrary to the terms of the offer.

‘The plaintiff avers that the letter of offer dated September 23, 2020 clearly highlights there were no existing borrowing facilities that Cape Holdings had with the 1st defendant,’ the suit states.

According to Synergy, Cape Holdings had redeemed all its previous facilities with I and M in 2011 and had since banked with Co-operative Bank of Kenya, making the 2020 transaction a new loan rather than a refinancing arrangement.

The company further alleges that the delay in enforcing the decree allowed Cape Holdings and its directors to dispose of assets that could have satisfied the judgment.

It claims company assets were dissipated, properties transferred to directors, their spouses, children and other relatives, and company funds used to acquire additional properties.

Synergy says it is still pursuing recovery of the outstanding debt through the sale of Cape Holdings’ assets once the pending court cases are concluded.

The targeted assets include the 14 Riverside complex, valued at Sh5.4 billion in October 2025, and several properties in Kajiado County with a combined estimated value of Sh105.7 million.

The company argues that had I and M not delayed execution through insolvency proceedings and prolonged court battles, it would have recovered a substantial portion of the debt before interest pushed the amount owed beyond Sh11 billion.

Listed mortgage lender HFCB Kenya (formerly HFC, Housing Finance, HF Group) has secured a partial court victory after the High Court overturned an order requiring it to refund a borrower Sh8.4 million over a disputed mortgage account.

The court ruled that the evidence used to calculate the alleged overcharge was unreliable. However, it upheld findings by the lower court that HFCB breached its loan agreement by varying interest rates without giving the contractually required notice and by imposing charges not provided for in the mortgage documents.

The High Court partly allowed the lender’s appeal against a 2024 judgment by the Milimani Chief Magistrate’s Court, which had ordered HFCB to refund the money to the estate of the late Benson Njenga Ndindi, together with interest dating back to March 2000.

Mortgage dispute

The case arose from a mortgage taken in 1991 to finance a property in Nairobi’s Runda estate.

The estate argued that HFCB repeatedly increased the interest rate from the agreed 18 percent to as high as 26 percent without issuing the four months’ written notice required under the charge document.

It also accused the lender of imposing penalty interest, default charges and other unlawful debits that inflated the outstanding loan balance long after the facility had allegedly been repaid.

The magistrate accepted those claims and relied on an analysis by the Interest Rates Advisory Centre (IRAC), which concluded that the borrower had overpaid the loan by Sh8.4 million by March 2012.

On appeal, however, the High Court found that although HFCB breached the loan agreement by varying interest rates without the required notice, the IRAC report did not conclusively establish the amount allegedly overcharged.

‘The finding of the subordinate court that the respondent was overcharged in the sum of Sh8.4 million is set aside, as the IRAC report upon which it was premised was fundamentally flawed and lacked the requisite probative value to sustain such a finding,’ the court ruled.

The judge said the expert report failed to provide detailed calculations supporting its conclusions, overlooked key contractual documents, including a 2003 loan restructuring agreement, and relied solely on records supplied by the borrower without seeking corresponding records from the bank.

The court nevertheless upheld the magistrate’s finding that HFCB unlawfully varied the interest rate without first issuing the required four months’ notice.

‘The issuance of notice’ was a contractual precondition for varying the interest rate, the court said, noting that one of the bank’s witnesses admitted during the trial that, on one occasion, the interest rate was changed on the same day the notice was issued.

The court also upheld findings that HFCB was not entitled to levy penalty interest, interest on arrears or default charges because those fees were not provided for in either the charge document or the letter of offer.

However, it overturned the lower court’s finding that HFCB had unlawfully debited insurance premiums, ruling that the issue had not been pleaded and should not have been determined.

The judge also set aside the finding that HFCB breached the Banking Act’s in duplum rule, holding that the evidence did not support that conclusion.

Rather than dismissing the claim, the court directed the parties to appoint an independent accountant within 14 days to recompute the mortgage account using a fixed interest rate of 18 percent throughout the loan period.

The fresh computation will exclude penalty interest, interest on arrears and default charges while taking into account the 2003 restructuring agreement.

If the parties fail to agree on an accountant, the chairperson of the Institute of Certified Public Accountants of Kenya will nominate one. The accountant will have 45 days to file a report, after which the court will issue further orders, including any refund that may be due.