Kenya’s pension assets under management (AUM) reached KSh 2.25 trillion in 2024, capping off a decade-long expansion of the retirement benefits sector, data from the Retirement Benefits Authority (RBA) shows.
- •That’s nearly 4x growth from KSh548.7 billion in 2012, with the industry averaging an annual growth rate of 11.6%, driven by rising contributions, market stability, and changing investment strategy.
- •From June to December 2024, pension assets grew by KSh276.5 billion, a 14% half-year gain, powered by higher inflows from the National Social Security Fund (NSSF), triggered by increased statutory contribution limits, helped power this growth.
- •With sustained contributions and market recovery, AUM could cross KSh3 trillion by 2027.
A rally on the Nairobi Securities Exchange (NSE) lifted the value of quoted equities held by pension schemes, further supporting the 2024 growth.
Despite the rise in alternative assets, more than 90% of total AUM remains in government securities, guaranteed funds, equities, and property. Government bonds alone make up over 52% of pension investments. However, allocations to offshore and private equity rose sharply, showing appetite for diversification.
| Asset Class | 2012 Share | 2024 Share | Direction |
|---|---|---|---|
| Govt. Securities | 35% | 52.5% | ↑ |
| Quoted Equities | 24% | 9% | ↓ |
| Guaranteed Funds | 9% | 19.4% | ↑ |
| Offshore + Private Equity | <2% | ~3.6% | ↑ |
Improved macro conditions underpinned the market. Inflation declined to 3.5%, interest rates dropped, and the NSE 20 Index climbed 21% in H2. The stronger macro environment supported revaluation gains across most portfolios.
| Indicator | Mid-Year | Year-End | Movement |
|---|---|---|---|
| Inflation (avg) | 5.6% | 3.5% | ↓ |
| CBK Rate | 13.0% | 11.25% | ↓ |
| NSE 20 Index | 1,656 | 2,010 | +21% |
| USD/KES | ~137.3 | ~129.3 | Stable |
All asset classes remained within regulatory limits. With government securities still fall below the 90% cap, alternative assets have plenty of headroom, giving pension schemes room to diversify without policy friction.
Kenya’s pension industry is maturing. The sector’s size, structure, and risk appetite are changing.
