Overview
Money Market Funds (MMFs) in Kenya are navigating a shifting landscape in October 2025, shaped by a declining interest rate environment and recent monetary policy adjustments by the Central Bank of Kenya (CBK). As of October 13, 2025, Ndovu, Cytonn, and Nabo remain among the country’s top-performing MMFs by annual yield.
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Market and Economic Context
Declining Yields
MMF returns have continued to soften through 2025, largely due to the sustained fall in Treasury Bill (T-Bill) rates. The government’s decision to reduce domestic borrowing — in a bid to boost private-sector credit — has eased competition for funds and consequently pushed yields downward.
Central Bank Rate Cuts
At its October 7, 2025 meeting, the CBK further reduced the Central Bank Rate (CBR) to 9.25%, following an earlier cut to 9.50% in August. This continued accommodative stance is expected to sustain liquidity in the market but will likely exert more downward pressure on MMF yields in the short term.
Inflation Pressure
Kenya’s inflation edged up to 4.6% in September 2025, from 3.6% a year earlier, driven mainly by higher food and fuel costs. The rise in inflation erodes real investment returns, slightly dampening MMF investors’ purchasing power despite nominal gains.
Top Performers – October 2025
Based on the latest data, the following funds have demonstrated notable performance:
- Cytonn Money Market Fund – Effective Annual Rate (EAR): 12.69% (as of October 7, 2025)
- NCBA Fixed Income Fund – Daily Yield: 7.57%, EAR: 7.83% (as of October 8, 2025)
- Apollo Money Market Fund – Annual Yield: 10.0% (as of October 2, 2025)
- Ndovu and Nabo – Among the top three MMFs by annual yield as of October 13, 2025
These funds continue to attract short-term investors seeking stable income despite the tightening yield environment.
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Performance Movements
Top Gainers (Week Ending October 13, 2025)
- Nabo, Jubilee, Orient Kasha, Old Mutual, Dry Associates, Mayfair, Stanbic, and Ziidi registered week-on-week yield increases, showing resilience amid the overall market slowdown.
Top Decliners (Week Ending October 13, 2025)
- Arvocap, Faulu, and Madison were among the few funds that saw moderate declines in their annual yield rates compared to the previous week.
Assets Under Management (AUM)
As of June 2025, the largest MMFs by asset size were:
| Fund | Assets Under Management (KES Billion) | Ranking (June 2025) |
| Sanlam MMF | 92.7 | 1 |
| CIC MMF | 87.8 | 2 |
| Absa Shilling MMF | 23.0 | 3 |
| ICEA Lion Fund | 20.2 | 4 |
| Old Mutual MMF | 19.4 | 5 |
The Sanlam and CIC funds continue to dominate the sector, accounting for a significant share of total market assets and providing stability through diversified portfolios of short-term government and corporate instruments.
Outlook
The short-term outlook for Kenyan MMFs points to moderate but steady yields. The recent CBR cut to 9.25%, coupled with reduced government borrowing, is expected to maintain liquidity and stabilize returns at slightly lower levels. However, inflationary pressures and potential global monetary tightening may influence portfolio rebalancing toward funds offering better real yields.
Investors seeking capital preservation and liquidity remain well-positioned in MMFs, but yield-conscious investors may explore diversified fixed-income strategies as rates adjust through the final quarter of 2025.
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