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Nursing colleges are expanding across the country, particularly in urban areas, offering hope to a population in need of quality healthcare.

Private health institutions, such as Nairobi Hospital, MP Shah, and Nairobi Women’s Hospital, are increasing their intake capacities and producing more nurse graduates who are ready to provide services, reducing the shortage in the health sector.

However, behind these numbers lies a stark reality. The country is still struggling to meet global benchmarks for health workforce densit

‘Kenya continues to face a shortage of nurses and midwives. Key factors identified as causing the shortage of nurses and midwives include brain drain, a poor working environment, natural attrition, a rapidly growing population, an ageing population, and emerging diseases,’ said the Nursing Council of Kenya (NCK) in their latest policy brief.

While Kenya’s nurse-to-patient ratio has increased from 8.3 to 22.7 per 10,000 people, the 2025 World Nursing Report shows that this is still below the World Health Organization’s (WHO) recommendations, an indication that, although more nurses are entering the system, the scale of production is not yet sufficient to meet the country’s healthcare needs.

The WHO recommends a minimum of 25 nurses per 10,000 people to ensure universal access to essential health services.

Data from the Economic Survey indicate that the number of graduate nurses has increased, from 4,808 in 2020 to 9,189 in 2024, a 91 percent rise over four years.

However, thousands of these professionals are leaving the country to seek better opportunities abroad, drawn by higher salaries, clearer career progression, and improved working conditions.

Even those who remain in Kenya often struggle to find employment in hospitals or clinics, leaving many qualified nurses unemployed.

Peterson Kirui, a Moi University Eldoret nursing graduate, has worked part-time for two years at a small dispensary in his home area. It was a tough struggle, but the pay was too low to provide even the bare minimum for survival, so he decided to take up research work instead.

‘I have had to look for other sectors of the economy to put food on the table. I have had to go into research,’ he said.

Mr Kirui’s situation mirrors that of thousands of nurses across the country who have qualified but cannot find employment, highlighting a growing disconnect between training and service delivery.

The cost of a three-year nursing diploma varies widely depending on the institution. At public colleges such as the Kenya Medical Training College, government-sponsored students pay about Sh240,000 for the entire course, while self-sponsored students pay around Sh359,700.

Read: Diploma nurses eye level pay with degree holders on upgrade

At private hospital-based colleges such as Nairobi Women’s Hospital, the cost is about Sh405,000 for three years, while at Nairobi Hospital Nursing College, it is around Sh603,000.

According to the NCK, around 10,000 students graduate with nursing qualifications each year, yet fewer than 3,000 find employment. The NCK also says more than 40 percent of registered nurses are either unemployed or underemployed, indicating an intensifying crisis.

‘Almost 50 percent of the difficulties in filling vacant positions relate to budgetary constraints, followed by a lack of goodwill from county governments to fill the required positions,’ said the NCK.

The implications are severe. Hospitals operate under chronic staff shortages, which is overwhelming for those on duty and means that patients have to wait for hours or go without essential care.

‘The emigration of nurses and midwives, especially those in specialised categories, has a crucial bearing on the quality of care provided in health facilities. This is a critical concern for healthcare systems at all levels as it has an immediate and long-term effect,’ said NCK.

A report by CGFNS International on nurse migration showed that, in 2024, Kenya accounted for 6.5 percent of all African applicants seeking US VisaScreen certification to work in the United States.

A 2023 report by the Ministry of Health revealed that up to 64.4 per cent of healthcare professionals had expressed a desire to emigrate.

While the government claims that this could increase remittances to the country, strengthen the foreign exchange rate, and boost the overall economy, some health officials have cautioned against the looming shortage of qualified medical personnel.

‘Labour migration is a critical component of our socio-economic development, benefiting both Kenya and the countries that welcome our workers. This is why we continue to negotiate bilateral labour agreements to facilitate safe and orderly labour migration, protecting Kenyan workers’ rights and facilitating their access to international job markets,’ said President Ruto during last year’s Labour Day celebrations.

Added NCK: ‘Emigration (92 percent) and increased patient volume (92 percent) are the main contributors to staff shortages, as is high staff turnover and retirement (88 percent).’

Recently, Kenya has seen hundreds of nurses move to the UK under bilateral agreements, while smaller numbers have sought jobs in Canada, Australia, and the Middle East.

In August 2023, 76 Kenyan nurses were sent to the UK to work under a bilateral health workforce agreement.

In April 2024, the government and Mount Kenya University sent the first group of five nurses to Germany as part of a plan to create 250,000 jobs for Kenyans.

However, rather than allowing Kenyans to seek jobs abroad, the United Nations Conference on Trade and Development has urged the government to improve pay and working conditions to discourage people from seeking employment elsewhere.

‘To stop brain drain, the government must improve working conditions and provide incentives. In the medium term, the government should enhance the attractiveness of job opportunities by improving pay and benefits,’ said the UN agency.

Psychology is emerging as one of the thriving professions in Kenya, due to the rising mental health awareness and a growing middle class willing to pay between Sh4,000 and Sh9,000 an hour for therapy.

Yet behind this career’s newfound prosperity lies a quieter struggle: the emotional toll on those who spend their days listening to other people’s pain. As demand surges, psychologists, BDLife spoke to a few of them on how they confront burnout, compassion fatigue, and the challenge of caring for themselves while caring for others.

Washington Kariuki’s journey to becoming a psychologist began with a personal struggle. After being expelled from school in Form Four, he felt like his world had fallen apart. ‘It was a humbling period of searching for meaning and direction,’ he says.

A friend suggested therapy, a simple act that would change his life forever.

‘Sitting in those therapy sessions, I experienced healing in a way I had never known before,’ he says. ‘It helped me rediscover who I was beyond the shame, confusion, and disappointment of that moment.’

That experience didn’t just restore him; it awakened a calling. He realised how many people walk through life carrying invisible wounds, pain they never voice, grief they never process.

He wanted to create spaces where they could be heard and held. That’s how he found his way to Tangaza University College, where he pursued psychology.

Today, Washington, 35, works with a private international non-governmental organisation, his schedule flexible enough to allow him to balance the emotional demands of his work.

He is a member of the Counsellors and Psychologists Board, (a professional body responsible for the ethical standards in mental health practice), the Positive Psychology Association of Kenya, and the American Psychological Association in the United States.

But his curiosity didn’t stop at Western psychology. Later, he joined the Maryknoll Institute of African Studies, studying African tradition and spirituality in collaboration with Saint Mary’s University of Minnesota.

‘Many of our emotional experiences and ways of healing are rooted in culture, spirituality, and community,’ he explains. ‘I wanted to bridge modern psychology with indigenous African worldviews to help people heal in ways that honour both their psychological and cultural identities.’

He has been practising since 2014, and over time, his work has evolved to become both scientific and deeply human.

The work of a psychologist is both noble and heavy. ‘Compassion fatigue is real,’ Washington admits. ‘It’s like running out of emotional oxygen.’ After hours of listening to trauma and grief, I often find myself emotionally drained, unable to switch off.

He recalls some of the most emotionally demanding moments of his career, working at the Kakuma Refugee Camp, surrounded by people who had lost everything. ‘There were days I sat across from someone who had seen lifeless bodies or fled war. The helplessness in their eyes would stay with me long after the session,’ he says.

He has also worked with offenders living with mental conditions, a task that demands immense empathy. ‘Supporting people who have caused harm but are also victims of pain requires holding complex emotions, compassion, accountability, and humanity, all at once.’

Still, Washington shows up. Every day. ‘Healing, even in small ways, still matters,’ he says.

But holding other people’s pain requires boundaries – ethical, emotional, and spiritual ones. ‘In Kenya, we often work in close-knit communities where everyone knows everyone. You may meet a client in church or at the market. They may ask to talk right there, but you have to balance professionalism with human connection.’

After years in the field, he has learned that emotional strength isn’t about being unshakable. ‘We, too, are human,’ he says. ‘We feel, absorb, and empathise deeply. Being composed doesn’t mean being emotionless; it means being able to hold space for others while still being honest about our own humanity.’

His way of regaining balance is rooted in movement and mindfulness. ‘Nature heals me,’ he says. ‘I hike, run, or spend time in the mountains. There’s something symbolic about standing on a mountain; it reminds me of perspective, resilience, and stillness.’

When he’s not in session, you might find him at the gym or watching a rugby match. ‘Rugby gives me joy and connection,’ he says. ‘It’s a reminder of rhythm, resilience, and teamwork, the same things that keep me grounded in my work.’

But not all coping methods have worked for him. ‘I once thought watching TV or scrolling on my phone was enough to unwind, but that only numbed the fatigue,’ he admits. ‘True rest comes from intentional spaces: silence, solitude, and movement. It’s not about escaping tiredness but restoring the spirit.’

At home, Washington is deliberate about drawing a line between his professional and personal life. ‘After a long day, I take walks, go to the gym or quiet reflection,’ he says. ‘When I walk through my door, I allow myself to just be Washington, not the psychologist.’

‘My family doesn’t need therapy sessions; they need my laughter, my presence, my humanity,’ he adds.

Though psychology often intertwines with his personal life, he tries to keep it natural. ‘Empathy and listening show up in how I relate to people, but I don’t analyse my loved ones,’ he says. ‘At home, I allow myself to be vulnerable too, to share, to seek support.’

Is psychology financially sustainable in Kenya? ‘It is improving. When I began, opportunities were few, but awareness around mental health is growing. I’ve been fortunate to earn well; my highest monthly pay has been Sh230,000, but for me, sustainability isn’t just about the paycheck.’

‘It’s about emotional balance, professional growth, and being able to serve others without losing yourself,’ he says.

For him, true success isn’t measured in figures or fame. ‘When a client begins to breathe again after weeks of despair, when tears turn into laughter, or when someone finds the courage to forgive themselves, that’s success.’

‘When I was applying for courses, my dad suggested I fill in general psychology to complete the form,’ she recalls. ‘He said I loved talking to people and had a way of commanding a room. That’s how I found myself in this career, and I’ve grown to love it.’

She began her practice in early 2022 after graduating with a Bachelor’s degree in psychology from Kenyatta University. She later went for her attachment at Mama Lucy Hospital, an experience she says laid the foundation for her work as a practicing psychologist.

Also, a member of the Counsellors and Psychologists Board in Kenya, she enjoys helping people to understand themselves, heal, and grow. ‘Seeing those moments of realisation and resilience is deeply fulfilling,’ she says.

Working full-time and scheduled appointments on weekends with clients in a private organisation, Grace has come to appreciate both the beauty and the burden of her chosen path.

But there’s one misconception she often encounters. ‘People think I can read minds,’ she laughs. ‘Once I mention I’m a psychologist, that’s the first question I get. In truth, our work involves understanding behaviour, emotions, and thought patterns, then helping people change or strengthen them.’

Many assume psychologists are always calm and composed. ‘It comes with the job. I’m trained to stay composed, even when listening to painful experiences. The client is seeking help, not emotional reactions from me either,’ she says.

Yet, the emotional toll can be heavy. ‘The biggest challenge I’ve faced so far is the emotional burden,’ Grace admits. ‘Sometimes life keeps moving, and I don’t take time to debrief. Those suppressed emotions can later burst and affect my day-to-day experiences. But I’ve learned to recognise when I’m emotionally fatigued. That’s when I take a break.’

She acknowledges that psychologists are human too. ‘Sometimes the mask cracks. When emotions become overwhelming, I take a break or refer a client. Emotional exhaustion is part of the work.’

Some cases are particularly heavy. She mostly handles gender-based violence cases. ‘Those involving minors are the most difficult. They often involve disturbing experiences of defilement or abuse. It becomes even harder when guardians withdraw complaints,’ she says.

Before becoming a psychologist, Grace relied on listening to music and spending time in nature ‘Now I’m more intentional with mindfulness, emotional regulation, and setting boundaries. Reflective practice helps me manage emotional demands better.’

After long or difficult sessions, she unwinds through creative outlets. ‘I paint, attend outdoor events with friends, and journal. It helps me relax and express myself.’

On weekends, she prefers reading fantasy stories to help her relax and make her journaling more imaginative.

Her recovery time depends on the week. ‘If it’s been intense, I take a few hours to rest or journal. When I feel emotionally tired, I take time off to recharge.’

She maintains clear boundaries between work and personal life. ‘Once I leave the office, I switch off. I spend time with family by watching movies, or help with house chores. It keeps me grounded.’

Still, psychology is part of who she is. It’s not something she can turn off, but she adjusts to it. ‘At home, I’m more relaxed and personal, not a counsellor, but a partner or friend. I listen with empathy but without being clinical.’

Depending on experience, specialisation, whether you work in the public or private sector, and how much you earn from your practice or side tasks, Grace says psychology can be financially viable.

Her highest earnings per session have been Sh4,500 for 45 minutes. But for her, fulfilment outweighs figures. ‘Success isn’t in the number of clients or money. It is in seeing someone regain confidence, peace, or purpose. Those thank-you notes and follow-ups mean everything.’

The calmness isn’t detachment; it’s discipline. Her empathy isn’t a weakness but a strength. ‘Healing isn’t one-sided,’ she reflects. ‘It happens on both sides of the session. As I help others, I keep learning and growing too.’

‘I go for debrief sessions’

For as long as she can remember, Nelius Njuguna, 26, has been drawn to helping people. As a child, she dreamt of becoming a doctor until she discovered she couldn’t stomach the sight of blood or dead bodies.

I realised that part of medicine wasn’t for me,’ she opens up. ‘But I still wanted to help people in a meaningful way. That’s how I found psychology. I feel like therapy is a calling, much like teaching.’

Though psychology wasn’t her first choice, Nelius believes she ended up exactly where she was meant to be. She started back at Moi University in 2021 and later went for her attachment at Mathare National Teaching and Referral Hospital.

‘If I ever had to shift careers, ironically, I don’t think I would. I feel like I’m where I’m supposed to be,’ she says.

She currently works as a consultant psychologist with a private organisation, clocking in from 8am to 5pm. Besides that, she is a member of the Counsellors and Psychologists Board of Kenya.

Her greatest joy lies in seeing lives transform. ‘What I love most about being a psychologist is that I get to impact people’s lives. I help them realise their potential and set themselves up for greatness,’ she says. ‘When I see someone move from confusion or pain to purpose and confidence, it reminds me that we all have the potential to be great, something I’m still working through myself.’

Still, the work can take an emotional toll. She says, people often think that psychologists fix people’s lives, yet they just help guide them back to themselves. ‘It’s about walking the journey with them, not dictating the path,’ she adds.

Nelius quickly dispels the myth that psychologists are always composed. ‘No, not always,’ she laughs. ‘I feel just as much as the next person. The difference is that I’ve learnt how to better manage my emotions, which helps me navigate life more steadily.’

Learning to switch off her mind after work has also been one of her biggest challenges.

‘Sometimes it’s hard to stop thinking about my clients,’ she admits. ‘But I’ve learnt that I can’t be everything to everyone. I’ve learnt to refer even people close to me to other psychologists so that I can separate my professional and personal life.’

She admits that some cases linger long after sessions end. ‘I can’t break confidentiality, but some cases are heavier than others. At the end of the day, I’m only human, and some of them do get to me,’ she says.

Before she trained as a psychologist, Nelius didn’t always have the healthiest ways to deal with emotional pressure.

‘When the going got tough, I’d have a mental breakdown,’ she says candidly. ‘I still get those moments, but I’m in a much better place mentally now. I’m still learning. As humans, we’re always evolving and growing.’

Her self-awareness has grown with time. ‘I’ve learnt that feeling emotions isn’t a weakness, it’s part of being alive. The key is how you respond to them.’

Asked about the financial side of psychology, she offers a candid answer, too. ‘Sometimes it feels like the work you put in doesn’t always match the compensation. This is a field you get into out of passion,’ she says.

When the week has been emotionally charged, Nelius retreats inward. ‘My favourite way to decompress is meditation,’ she says. ‘I like to reflect and then clear my head to prepare for what’s next.’

She also journals, a habit she finds both grounding and freeing.

‘Journaling helps me make sense of my thoughts. I encourage everyone to find what works for them, but for me, writing clears the noise.’ Rest, she adds, is non-negotiable.

‘When I feel I’m at the verge of a breakdown, I take time to collect myself and go for debrief sessions. Yes, psychologists go to therapy too,’ she says with a smile. ‘It helps me be in a better position to help my clients.’

Breaks, for her, aren’t scheduled by the clock but by instinct. There were coping methods that didn’t work.

‘I used to use partying as my way to decompress,’ she says. ‘I love music and dancing, but I realised it wasn’t helping me heal. It was just noise masking exhaustion.’

Even outside her practice, Nelius finds that her work shapes how she relates to others. ‘You have to show up for people the way they want you to, not the way you think they need you to,’ she says. ‘Some people want advice, others just want to vent. I try to be who they need me to be in that moment.’

This ability to switch between being a professional listener and a present friend helps her maintain balance. ‘I try not to bring work home. I’m intentional about being there for my loved ones without turning every conversation into a session.’

Jepkemoi founded and now runs a midsize food processing company in Kitale. When staff ask her what the business is really trying to achieve in terms of indicators and impact, Jepkemoi brushes them off and says the job solely exists to make money and keep costs low.

Different departments within the company chase different ideas of what matters to them without an overarching unified vision. Quality eventually begins to slip.

Customers, at first, gradually and then rapidly start drifting away and finding other suppliers. The staff in turn feel tired and replaceable. Even though everyone is busy, no one is sure what they are actually building and working toward.

Researchers Gerard George, Martine Haas, Anita McGahan, Simon Schillebeeckx, and Paul Tracey warn about such purpose and meanings gaps in their widely read study.

The research states that corporate purpose exists as much more than a slogan. Rather it is a clear explanation of three distinct purposes.

First, why the firm exists. Second, who the company tries to create value for. Third, what future is the organisation trying to build. Many firms erroneously just dismiss purpose as an external facing slogan and do not cascade down the real tripart purpose that the board, and hopefully senior leadership team, already know. So, the employees are left guessing and pondering their future and meaning.

Strong purpose among the three meanings must blend both a goal view, which is what one is trying to achieve, and a duty view, which is who an entity refuses to harm and who that entity is committed to serving responsibly.

When leaders only talk about profits over and over again, but ignore the organisation’s duty of care, then employee trust collapses which eventually impacts customer faith and trust.

On the flip side, when leaders only talk about duty but ignore performance, execution stalls and come to a standstill. The work of a senior executive is to hold both dimensions as they lead.

The research outlines three stages in which leaders can shift the internal culture towards a purposeful direction. Initially, start with framing. Say in plain, direct, and specific language what the firm stands for. Capture the stance in one sentence. Do not overcomplicate it and leave out buzzwords, acronyms, and slogans.

Next, formalise the purpose. Layer the purpose into the organisational structure, human resources incentives and rewards, hiring practices and profiles, training regiment, reporting lines, and the board’s attention through specific agenda items.

If nothing inside the organisation’s internal mechanisms changes, then everything was just for talk and not substance. It is better to do nothing than to elevate staff hopes and then not proceed to change anything.

Finally, realising the purpose. Show proof that the purpose is being achieved in phases. Purpose has to result in visible benefits for customers, staff, and communities, not just merely for shareholders or else it seems meaningless.

Sometimes that can even mean walking away from easy short-term money because it clashes with what you said you stand for. As an example, Kenyan indigenous management consulting firm WYLDE International has famously walked away from public sector contracts that required implied bribes, as seen on social media and in conferences, so as to keep fidelity to one of its core purposes of business with integrity across all its business units and platforms.

The study also makes a harsher, more focused point. Purpose gets enforced by people, not posters, banners, or taglines. Business founders leave their fingerprints on what the company believes is right. But it becomes the staff that either carry it forward or quietly kill it.

Regulators, investors, and communities apply pressure when behaviour and messaging do not match. So, leaders who claim a purpose but reward the opposite behaviour are not just being fake, they are actively training their best people to leave the organisation.

Here is what executives here in Kenya can start doing this month to instill purpose. Write a one sentence honest purpose that a front-line normal employee would recognise.

Then change one real thing in how you run the business to match that sentence. Take for example things like how you pay, what you measure, or who gets promoted. Then showcase one piece of evidence to share with staff that proves you mean it. For example, farmer payouts, defect rates, staff retention, community safety, whatever fits your care purpose.

In summary, remember that purpose is not about branding.

Instead, it exists as internal wiring. When internal design and external expectation become aligned, then companies perform better and last longer. When the two fall out of sync, then you get what Jepkemoi is living with right now and the firm sinks.

The Employment and Labour Relations Court has upheld the sacking of a lecturer accused of sexual harassment by inappropriately touching female students, hugging them suggestively, and using uncomfortable terms to address them, such as ‘darling’ and ‘sweetheart.’

The court said that Oshwal College in Nairobi had a valid and fair reason for terminating the employment of Benard Nyamamba Mauti in May 2023 on grounds of gross misconduct.

After reviewing the students’ complaints, the court said, it was evident Mr Mauti’s conduct was inappropriate and amounted to sexual harassment, and his actions clearly breached the boundaries of the professional student-teacher relationship, expected of him.

As a lecturer, the claimant was under a strict obligation at all times to maintain professionalism in all interactions with his students and to refrain from any verbal or physical behaviour of a sexual nature,’ said the court.

Although the students described the lecturer as a good teacher, his conduct was unethical and inappropriate.

And while he allegedly referred to female students as ‘sweetheart’ or ‘darling,’ was overly touchy with them, hugged and whispered in their ears, it was claimed that he was notably harsh towards male students.

‘In light of the foregoing, the Court finds no reason to doubt the credibility of the students’ statements outlining the allegations against the Claimant,’ said the court.

Mr Mauti was employed by the college in 2010 as a lecturer under an open-ended contract of service and said that he performed his duties diligently throughout his employment.

He was fired on May 19, 2023, over allegations of sexual harassment, but he maintained that his termination was irregular, unlawful, unjustified, and in blatant violation of the Employment Act.

Mr Mauti wanted the court to issue a declaration that his sacking was wrongful and amounted to unfair and unlawful dismissal.

He also sought to be paid damages and compensation for breach of contract amounting to Sh22.7 million, being the wages for the remainder of the contract period from May 1, 2023, until retirement age of 60 years.

He testified that he was summoned to the principal’s office on April 26, 2023, in the presence of the Academic Registrar, where he was informed that he was under investigation based on student appraisal forms.

He said that, through threats and intimidation, the principal failed to fully disclose the nature of the investigation and did not allow him to view or examine the said appraisal forms, which allegedly contained claims of sexual harassment made against him.

A few days later, he said he was summoned to appear before a panel and informed that he was under investigation for sexual harassment allegations made by certain students.

Mr Mauti claimed that the panel, which he considered irregular and incompetent, interrogated him unlawfully without providing adequate or clear particulars of the allegations, including the identities of the complainants, the specific nature of the accusations, or any supporting evidence such as complainant statements, CCTV footage, or reports.

Despite this lack of disclosure, he answered the panel’s questions and categorically denied all allegations.

The lecturer said he granted only three days to respond to the show cause letter, yet he had not been furnished with full and detailed particulars of the allegations, including the names of the complainants, the specific allegations, and the evidence relied upon.

He maintained that the statements were fabricated and backdated to appear genuine after he had demanded them during his interrogation by the panel.

The college management defended the termination, saying the decision was conducted in accordance with the law, fair and lawful, and that he was in breach of the Employment Act and the college’s human resources manual.

The college said it first received a complaint regarding his conduct involving sexual harassment, specifically, an incident in which he kissed a student in the library.

Mr Mauti allegedly acknowledged his misconduct and, by a letter dated August 23, 2010, he tendered a written apology, undertaking that such behaviour would not recur.

About four years later, there was another complaint from a parent alleging that he had been sending inappropriate text messages to her daughter, which made the student uncomfortable.

Once again, he allegedly admitted to the conduct, apologised, and was cautioned regarding his behaviour and its potential consequences.

There were more complaints from students, with one alleging that he had inappropriately touched her, solicited and received a gift from her, and made unwarranted phone calls to another student.

Again, he was reminded of the college’s duty to maintain a safe and respectful learning environment and was issued a final warning, cautioning that any further breach of the institution’s ethical or welfare standards would lead to immediate termination of his employment.

The court said the alleged behaviour of touching and hugging female students and addressing them with terms such as ‘darling’ or ‘sweetheart’ was wholly improper and constituted sexual harassment.

‘As a learning institution, the Respondent bore a duty of care to its students to ensure that the learning environment remained safe, both physically and emotionally. This duty required the Respondent to investigate any allegations of sexual harassment and to take appropriate disciplinary measures if such allegations were substantiated,’ said the court.

The court said it should also be appreciated that the college was not required to prove the allegations against the lecturer beyond a reasonable doubt.

The manufacturing sector has broken into the top three most tax-compliant bracket, displacing transportation and storage from top-tier sectors in corporate income tax (CIT) payments for firms already in the tax net.

Data from the Kenya Revenue Authority (KRA) shows that manufacturing ranked third in on-time corporate tax payments for the financial year ended June 2025, recording a compliance rate of 77.09 percent.

Factories joined companies engaged in real estate activities and financial and insurance firms, which maintained their lead in tax discipline at 80.01 percent and 79.51 percent, respectively. In contrast, transportation and storage, which held third place in the 2023-24 fiscal year with a 76.07 percent compliance rate, dropped out of the top bracket.

The manufacturing sector’s stronger tax compliance coincided with renewed momentum in industrial activity, as shown in the latest quarterly data by the Kenya National Bureau of Statistics (KNBS).

Non-food manufacturing recorded gains in the second quarter of 2025, signalling renewed investor confidence, growing domestic demand, and steady capacity utilisation across factories.

Firms engaged in cement production raised output by a fifth (21 percent) to 2.47 million metric tonnes from 2.04 million tonnes in the same period last year, while production of galvanised sheets rose 11.3 percent to 77,200 tonnes.

The KNBS data further shows motor vehicle assembly increased 20.8 percent to 3,350 units in three months to June from 2,773 units a year earlier.

The KRA data, however, shows that firms in the real estate sector were the most tax-compliant for the second year in a row, posting the highest on-time payment rate of CIT at 80.01 percent in the 2024-25 financial year, up from 77.55 percent a year earlier.

The developers and landlords in the tax net were followed by those in the financial and insurance sector, which had an 79.51 percent on-time payment rate.

At the same time, the KRA data show that the financial services sector led in on-time filing of the annual corporate tax returns, registering a compliance rate of 74.20 percent, ahead of energy (74.16 percent) and construction (74.03 percent).

Firms in banking and insurance services beat those in the energy sector, which had topped the annual CIT filing chart the previous year ended June 2024 at 74.02 percent, followed by finance (73.61 percent) and construction (73.55 percent).

This came in a period when the KRA reported that 461,969 firms-about 74.73 percent or three out of four companies-did not remit any money due to profitability.

The proportion of firms that skipped CIT payments in the year to June 2025 grew from 401,274 of 556,329 registered firms last year, or 72.13 percent.

The KRA numbers suggested that an overwhelming share of companies in the tax net were either genuinely loss-making or had mastered the art of tax planning. Tax experts say the gap between registered firms and taxpayers cannot be explained by business losses alone.

Stephen Waweru, a senior manager for tax services at KPMG, said the numbers highlight structural and behavioural challenges in corporate tax compliance.

‘Many firms are registered, many file returns, but relatively few actually pay instalments,’ he told the Business Daily.

‘The level of compliance seems to be improving, but it still falls far below what one would expect if firms in the tax net were largely profitable.’

Mr Waweru says this could be explained by the share of businesses-especially small and medium-sized enterprises or new entrants-that are genuinely loss-making, often squeezed by high inflation, rising input costs, exchange rate swings, and supply chain disruptions.

One question we should be asking ourselves as more banks launch their own financial technology or fintech subsidiaries is whether it creates a conflict.

Are the fintechs competitors to banks, or are they partners complementing each other? How are the symbiotic relationships between banks and fintechs being handled?

Yes, these fintechs are crucial because they have allowed digital payments, mobile money, online lending, savings and investment platforms, insurance technology, wealth management (robo-advisers), and even cryptocurrency and blockchain applications, and predict fraud and computer outages.

They are gradually stripping away the inefficiencies of traditional banking systems by using digital tools to lower costs, speed up transactions, and expand access.

In Kenya and Africa at large, this means enabling the unbanked or underbanked population to make payments, access credit, or save through mobile phones.

In an effort to keep up with technology, spur innovation, and tap into fintech’s hypergrowth, banks are now in a race to partner with fintechs.

Some operate as standalone or semi-autonomous fintech subsidiaries under their parent banks, a strategy that enables faster innovation outside legacy banking systems while maintaining regulatory compliance and brand connections.

Others do it differently.

A McKinsey report shows that of the top 100 banks by assets and other digitally advanced banks, four out of five have now partnered with at least one fintech company. That is up from 55 percent just two years ago.

For instance, Equity Group launched its fintech subsidiary, Finserve, about seven years ago. Nigeria’s Stanbic IBTC Holdings, in 2022, started a fintech subsidiary called Zest Payments.

Stanbic Kenya had similar plans, but last year it put its fintech subsidiary on hold just months after receiving regulatory approval. Barclays Plc partnered with Flux Systems to give customers itemised receipts on their smartphones, allowing them to see in detail how they spend their money.

Elsewhere, Bank of Kigali perhaps stands out. It operates a distinct fintech subsidiary. Bank of Kigali does solely commercial banking, while BK TecHouse, founded in 2016, serves as a digital enabler, collaborating directly with the bank to develop fintech products.

Digital adoption is no longer a question but a reality. Around 73 percent of the world’s interactions with banks now take place through digital channels, a McKinsey report notes. Therefore, without embracing technological innovation, banks risk fading into irrelevance.

However, the bank-fintech strategic alliance has to be a cautious one. The banks must remain the mothership, and the fintech the speedboat. In a partnership where this is not well understood, the favour will tilt towards the fintech, and these companies will become a significant threat to banks. Reason? Fintechs grow fast because they move quickly, try new ideas, and run simple operations, processes that can slow down once they face the strict rules of traditional banks.

Banks, by contrast, are known to be the opposite. They remain anchored in slow, rigid structures. Without proper separation, they risk being overtaken, or even swallowed, by the very fintechs they seek to control.

In fact, while partnerships between banks and fintechs have increased over the years, full acquisitions remain rare because, as McKinsey notes, ‘integration often slows decision-making and innovation cycles, undermining fintechs’ competitive advantage.’

Therefore, when a bank acquires a fintech, it must make sure that the same resources it has on the speedboat, which is a fintech, it has similar resources in the mothership, which is a bank.

Bank-fintech collaboration isn’t just a strategy; it is survival. But harmonisation, not dominance, must be the guiding principle.

Perhaps the other conversation we should be having is about neobanks, the digital, branchless units to capture the younger, tech-savvy generation that traditional banks often struggle to reach.

The Court of Appeal has temporarily shielded Ecobank Kenya from paying Sh840 million to the estate of former Cabinet Minister Mbiyu Koinange, pending the determination of its appeal against a High Court order.

In a ruling delivered by a three-bench, the appellate court found that Ecobank’s appeal raised arguable legal questions and that forcing immediate payout risked rendering the appeal futile.

The judges emphasised that releasing the funds could lead to their irreversible dissipation among beneficiaries of the estate, complicating recovery if the bank succeeds in overturning the High Court’s decision.

The dispute stems from 2011 withdrawals made from an estate account at Ecobank holding Sh284 million, which the High Court ruled were illegal. The estate is claiming an extra Sh556.6 million in accrued interest, bringing the total amount to excess of Sh840 million.

The High Court had earlier restricted withdrawals without its approval, but the bank disbursed the funds to lawyers representing beneficiaries in the long-running succession case.

In June 2025, the High Court held that the bank breached its fiduciary duty by failing to verify court orders before releasing the money.

The court ordered the bank to refund the full amount plus interest, a decision Ecobank challenged, arguing it was unfairly penalised for relying on instructions from advocates mandated to operate the account.

Its advocate contended that there were procedural flaws, arguing that the High Court adjudicated negligence and fraud claims summarily within succession proceedings, denying the bank a fair trial.

The advocate also stated that previous rulings by two other High Court judges had directed advocates -not the bank- to account for the funds. The money was part of the Sh1.1 billion proceeds from sale of Koinange’s land known as “Close Burn Estate Runda” in 2010.

It was further claimed that the bank was not aware of the court order dated July 26, 2011 to halt and restrict any dealings with the account.

The bank’s further argument was that complying with the June 2025 order would force the lender to dip into depositors’ funds, risking instability.

Since banks rely on depositor funds to do their business, the court agreed and found that abrupt withdrawals of the amount could destabilise operations of Ecobank.

However, the estate’s administrators insisted Ecobank knowingly violated the court orders. They asked for the money at the centre of the dispute to be deposited in a joint account opened by the advocates for the estate pending determination of the appeal.

‘The High Court judge properly directed himself on all issues on record; that any money deposited with the bank was trust money belonging to the estate, as appears in the Account Opening Forms,’ said the lawyer representing the Koinanges.

He added that the bank was aware that the money deposited was pursuant to a court order, and no withdrawals could be done without court sanction irrespective of the signatories of the account.

In addition, no part of the estate could be distributed without a court order.

Led by Koinange’s widow, Eddah Wanjiru Mbiyu, the administrators offered to secure the High Court decree by depositing title deeds of estate properties worth billions, but the court doubted their liquidity, noting ongoing succession disputes.

The appellate bench ruled that Ecobank’s appeal deserved a full hearing, citing arguable grounds such as whether the High Court overstepped by awarding alleged unpleaded reliefs and mixing succession with tort claims.

The judges also found that disbursing the contested money to the beneficiaries would make recovery “a herculean task” if the appeal succeeds.

‘The applicant (bank) is apprehensive, and rightly so in our view, that if the appeal were to succeed, tracing the said sum amongst the beneficiaries would be a herculean task,’ said the court.

‘Considering the interests of the parties in this application, we find that the balance tilts towards the grant of the stay, since no serious prejudice is likely to be occasioned to the respondent (Koinange’s estate) during the pendency of the intended appeal,’ said the judges.

The stay halts enforcement of the High Court’s order until the appeal is heard. Ecobank is expected to file its substantive appeal within timelines set by the court.

Koinange died on September 3, 1981. He served in President Jomo Kenyatta’s cabinet and briefly in President Daniel Moi’s administration.

Electricity imports hit a record high of 150.45 million kilowatt-hours (kWh) in August 2025, bringing to the fore Kenya’s deepening reliance on neighbouring countries to avert power rationing.

The latest official data shows that Kenya’s overall electricity imports rose five percent from 142.36 million kWh a month earlier, driven by increased supply from Uganda.

Kenya nearly doubled imports from Uganda in August, supplying 32.5 million kWh compared to 18.95 million kWh a month earlier, as imports from Ethiopia dipped in the same period.

Kenya recently completed another transmission line to Uganda, enabling it to buy more electricity from the neighbouring country. The new connectivity to Uganda ensures an enhanced supply of electricity to western Kenya.

Kenya has, in the last few years, significantly relied on Ethiopia and Uganda to bolster supplies and avert possible load shedding amid a rising demand and a freeze on new power purchase agreements.

Electricity demand hit a new peak of 2,363.41 megawatts in August this year, pointing to the surge in demand which has left Kenya staring at possible forced rationing in the absence of supplies from Ethiopia and Uganda.

Kenya Power Managing Director Joseph Siror recently said the reliance on imported electricity is increasingly leaving the country exposed.

‘It is a major concern, and this is not premised on the thinking that they will be unable to support us. Rather, my concern is that this is hydropower from these countries and, in a situation where there is a serious drought, it may put them in a position where they might be unable to meet this obligation,’ Dr Siror said two weeks ago.

Increased connections and the use of electricity by homes and industries are behind the growing demand.

The country imported 117.77 million kWh from Ethiopia in August this year, compared to 122.08 million kWh the previous month.

The record-high imports in August came in a month when local generation marginally dipped one percent to 1.146 billion kWh.

Generation from Kenya’s dams and wind power plants dipped in August, triggering the overall fall in the local electricity production.

Hydropower production in August was 296.01 million kWh from 320.73 million kWh the previous month, while output from the wind plants fell to 154.99 million kWh compared to 165.51 million kWh in the same period.

Hydropower is the second biggest source of power in the national grid, accounting for 23.7 percent in the eight months to August, ahead of wind and imports at 12.7 percent and 10.9 percent, respectively.

Geothermal, which is mainly supplied by the State-owned Kenya Electricity Generating Company, is still the dominant source of power in the country and had a share of 39.7 percent in the eight months to August.

Kenya has a 25-year power import deal with Ethiopia, where the country takes a maximum of 200 megawatts in the first three years, but this will double from December 2026.

Kenya also has power exchange deals with Uganda and Tanzania, where the country that imports more in a given period pays the other.

Kenya is making a second stab at establishing a sovereign wealth fund, with the Treasury publishing the Draft Kenya Sovereign Wealth Fund Bill 2025 to pave the way for the creation of the fund, which is to be managed and invested for the benefit of current and future generations of citizens of Kenya.

What is a sovereign wealth fund?

A sovereign wealth fund (SWF) describes an investment vehicle owned by a country that acts as an investment account or development tool, or a combination of both aspects. SWFs comprise money generated by the governmenHow long have sovereign wealth funds existed?

Kuwait created the Kuwait Investment Authority in 1953 to invest the government’s oil revenues on behalf of its future generations, with other countries following suit.

By 2010, the International Monetary Fund (IMF) estimated that there were over 50 sovereign wealth funds in operation covering over 35 countries, including Brunei, Kiribati, the United Arab Emirates (UAE) and the United States.

Which are the largest sovereign wealth funds?

The top five largest sovereign wealth funds as per data from the Sovereign Wealth Fund Institute running to January 2025 were the Norway Government Pension Fund Global ($1.7 trillion), the China Investment Corporation ($1.3 trillion), SAFE Investment Company-China ($1 trillion) and the Abu Dhabi Investment Authority ($1 trillion).

How are global sovereign wealth funds structured?

Norway’s Government Pension Fund Global is formally owned by the country’s Ministry of Finance, overseeing its overall investment strategy, ethical guidelines and investment framework.

The country’s Central Bank-Norges Bank-is responsible for managing the fund while the Norwegian Parliament makes decisions on matters of material importance to the fund’s risk level. The fund was established after Norway discovered oil in the North Sea to shield the economy from ups and downs in oil revenue.

Why is Kenya eyeing a sovereign wealth fund now?

Kenya has revived its goal of commercially exploiting oil fields discovered in Turkana in 2012.

The exploitation now led by Gulf Energy is expected to yield new revenue sources for the government, which will be placed in the sovereign fund alongside proceeds from the mining industry, including mining and prospecting licences, mining permits and leases and mineral royalties.

Kenya earned Sh226 billion from the mining sector in 2024, with the bulk of the proceeds of Sh154.1 billion being from mining licences.

How will the proposed Kenyan sovereign wealth fund work?

Kenya’s sovereign wealth fund will include resource flows from mining and petroleum. The fund will be split into three uses, including providing a buffer from fluctuations in resource revenues and managing extraordinary shocks to the economy, supporting strategic infrastructure investments and creating a savings pool for the future.

The Central Bank of Kenya (CBK) shall hold a bank account for the fund, which shall be used to receive, hold and disburse all proceeds of the fund.

The government is expected to create a board known as the Kenya Sovereign Wealth Fund Board, which shall manage, control and administer the assets of the fund.

The fund shall also have a secretariat led by a chief executive officer.

Where shall the Kenyan sovereign wealth fund invest its assets?

The bulk of the fund’s assets shall be invested in foreign currency-denominated instruments, including low-risk sovereign bonds, foreign currency deposits with other central banks and international settlement banks and bonds backed by multilateral institutions, including the World Bank and the IMF.

The fund is barred from investing in local bonds and stocks, speculative derivatives, arts and commodities.

Can sovereign wealth funds be abused?

The pilferage of the 1Malaysia Development Bhd (IMDB) sovereign wealth fund shows that such funds can be abused without proper safeguards. The fund raised billions of dollars in bonds to use in investment projects and joint ventures between 2009 and 2013.

The US and Malaysian authorities established that an estimated $4.5 billion (Sh581.5 billion) was diverted to offshore bank accounts and shell companies, with billions more unaccounted for. The SWF is now defunct.

t, which is often tapped from a country’s surplus reserves from activities such as oil, mineral exploration and trade.

Why do countries create sovereign wealth funds?

Sovereign wealth funds are designed to be a nest egg, allowing current funds to be deployed in a way that benefits future generations.

Countries with outsized revenues from resources such as minerals and oil have primarily created these types of funds, ensuring the windfall in resources creates a cash stockpile for the future, which comes in handy when the countries deplete their resources.

Funds in the Middle East, Norway and Russia have invested proceeds from oil and gas exports. Asian countries have funded their SWFs using trade surpluses from being net exporters, while Botswana, the only country with a SWF on the African continent, has invested revenues from diamond mining.

Foreign investors’ participation at the Nairobi bourse has dipped to its lowest level in over a decade as they seek higher returns in developed markets like the US and UK.

Data from the Capital Markets Authority (CMA) for the three months to September show that the share of foreign investor participation in the NSE equities market fell to 28.01 percent in September from 31.28 percent in August and 59.51 percent in April.

This emerges in a period when foreigners have remained net sellers at the NSE for all months this year save for June and August, making local investors key drivers of the bourse, which has gained 46.6 percent since the start of the year.

Foreign investors’ net sales, when share sales surpass purchases, rose to Sh7.2 billion in the nine months to September.

Steady returns from developed markets, including the US, the United Kingdom, China and Japan, have kept the offshore investors out of the NSE.

Stocks in the advanced markets have surged on the back of improved earnings and sustained appetites for tech stocks, which have been super-charged by their exploits in artificial intelligence (AI).

The share rally in the Western capitals has seen foreign investors ignore risky emerging markets such as Kenya, which has recorded a 46.6 percent gain, which the Nairobi All Share Index (NASI) has chalked up since the start of the year.

Analysts have reckoned that the continued positive returns from global markets, notably the US, have reduced the appeal of the NSE.

‘Positive returns year-over-year in developed markets make it more difficult to justify investing in Africa from a risk/reward perspective,’ analysts at Sterling Capital stock brokerage noted previously.

This month, the US market marked the third anniversary of its most recent bull run, which has been powered by gains in mega cap technology stocks such as Meta, Microsoft, Nvidia, Alphabet, Amazon, Apple and Tesla.

The US market rally has minted multi-trillion-dollar companies with Apple and Microsoft crossing $4 trillion in valuation each on Tuesday.

Drivers include improved sales of the new iPhone for Apple and the finalisation of a stake purchase in ChatGPT maker OpenAI’s for-profit business.

The market rally has defied concerns over President Donald Trump’s trade tariffs and fears of an investment bubble around tech stocks.

The NSE faced a difficult task of shaking off recent jitters, including weak policies and currency depreciation, which have exacerbated capital outflows from emerging and frontier economies.

Kenya has yet to have calendar net inflows from foreign portfolio investments into the NSE since 2019.

‘Capital flight to hard currency-denominated assets over the past few years has largely been driven by negative sentiment toward sub-Saharan Africa as a whole due to currency depreciation, the Covid-19 pandemic and inconsistent policies negatively impacting business,’ the analysts at Sterling Capital added.

Foreign investors made a high of Sh4.9 billion in net sales from the NSE in September, offsetting inflows of Sh1.6 billion in August, according to market data compiled from stock brokerages.

The foreigners have remained net sellers so far in October, selling stocks worth Sh1.4 billion on a net basis through Monday this week.

Outflows by foreign investors are expected to continue to the end of the year if gains in advanced markets hold up in the fourth quarter.

Global volatility from US tariff policies is, however, seen driving foreigners to return to emerging and frontier economies if the investment landscape in advanced economies becomes riskier and uncertain.

NSE market gains of 46 percent are on course to be last year’s return of 34 percent in what will cement its place as the top-earning asset class.

A stable exchange rate and low inflation have anchored the market rally alongside a drop in government security yields.

This has given investors