Kenyans to Get Up to Ksh4M Affordable Housing Loan to Build Own Houses

Hello and welcome to the Money News RoundUp Newsletter, where we are covering Parliament's approval for Kenyans to access Ksh4 million affordable housing loans for rural projects, top-valued companies as per NSE rankings, and Kenya's credit rating upgraded to B (plain).

Affordable Housing Goes Rural

Kenyans who contribute to the housing levy will now be able to access loans amounting to Ksh4 million to build their own rural homes.

A report by Daily Nation indicated that Parliament had approved new regulations paving the way for Kenyans who miss affordable housing units under projects managed by the government to become homeowners with single-digit interest loans.

The National Assembly's Committee on Delegated Legislation approved the Affordable Housing Regulations, 2025, noting, "Having considered the Affordable Housing Regulations, 2025 (Legal Notice No. 114), the committee recommends that the House approves the regulations."

Requirements: According to the regulations, a person qualifies for the loan if they have been saving with the Affordable Housing Fund and have not been allocated an affordable house.

Other requirements include provision of a development permit from the county government, a valuation report of the land, a priced bill of quantities prepared by a registered quantity surveyor, a copy of the title deed, an official land search, and a declaration that the loan will only be used to build the home.

Catch Up Quick: In his Madaraka Day speech earlier this year, President William Ruto promised that the government would extend a loan facility of up to Ksh5 million in a strategy designed to benefit contributors to the Housing Levy. He explained that the loan would be available not only for government-built houses but also for any housing unit in the market as well as to offset existing mortgages.

In Comparison: Affordable housing programmes currently offer mortgage interest rates of 9% while commercial banks and SACCOs charge higher than 12%.

Banks Overtake Manufacturers at NSE

Kenyan banks now dominate the Nairobi Securities Exchange (NSE), with eight of the top 10 most valuable firms coming from the sector, up from six in 2015, Business Daily reports. All 11 listed banks feature among the 20 largest companies, accounting for 38% of the market’s Sh2.62 trillion valuation. This dominance is driven by steady profit growth, regional expansion, and tech adoption, while manufacturers have struggled with high costs, weak consumer demand, and flat sales.

Equity Group (Sh207.6 billion) and KCB (Sh173.5 billion) now trail only Safaricom (Sh1.13 trillion), while EABL has fallen to fourth. BAT Kenya and Bamburi Cement, once top 10 firms, have slid down the rankings, with Bamburi acquired by Tanzania’s Amsons Group. Meanwhile, KenGen has surged to 11th place after a major share price rally.

S&P Upgrades Kenya’s Credit Rating to ‘B’

Global ratings agency S&P has upgraded Kenya’s long-term sovereign credit rating to ‘B’ from ‘B-’, citing reduced near-term external liquidity risks supported by strong export earnings and diaspora remittances, Reuters reports. The agency said Kenya’s solid growth and improved liquidity will help offset high interest costs and slow fiscal consolidation, while maintaining the outlook at ‘stable’. President William Ruto projects the economy will grow by 5.6% this year—above the finance ministry’s 5.3% and central bank’s 5.2% forecasts—compared to 4.7% in 2024.

Kenya Proposes New Rules for Telecom Infrastructure Sharing

The Ministry of ICT has drafted new regulations that would compel telecom operators and internet service providers to share critical infrastructure such as fibre cables, masts, towers, and data centres, Kenyans.co.ke reports. The Kenya Information and Communications (Infrastructure Sharing) Regulations, 2025, are aimed at cutting network rollout costs, reducing duplication, and expanding affordable access to communication services.

The government says the move will promote fair competition and lower entry barriers for smaller players, but industry concerns remain over risks such as sabotage, overuse, and reduced ability for firms to differentiate themselves in the market. The proposals are part of a broader ICT sector overhaul covering tariffs, spectrum allocation, consumer protection, and fair competition.

Farmers Shift From Hustler Fund to Banks and Digital Loans

Kenyan farmers are abandoning the State’s Hustler Fund, microfinance banks, SACCOs, and informal lenders in favour of commercial banks and digital loans such as Fuliza and KCB M-Pesa, Business Daily reports. A CBK survey shows that by May 2025, no farmer interviewed had borrowed from the Hustler Fund or microfinance institutions, while the share of farmers borrowing from banks rose from 41% in March to 58%. Digital loan uptake also grew from 2% to 8% over the same period.

The survey noted increased reliance on buyers of farm produce and informal savings groups, while borrowing from SACCOs dropped sharply from 35% to 24%. Farmers are also changing how they use credit: fewer are spending on inputs and labour, while more are financing equipment and machinery.

Kenyan Companies Increase Foreign Investments With Uganda, Ethiopia Leading

Kenyan companies expanded their foreign assets to Sh834.2 billion in 2023, a 36.8% jump from 2022, with Uganda, Ethiopia, and Tanzania emerging as the top destinations, Business Daily reports. Banks and telcos led the push into younger, high-growth markets, while KCB, Equity, and Safaricom were among the biggest investors. The UK also saw a sharp rise in Kenyan assets, while holdings in the US and UAE declined.

On the flip side, foreign direct investment (FDI) inflows into Kenya more than doubled to Sh242.6 billion in 2023, driven largely by the ICT sector, which overtook finance, manufacturing, and retail to become the top recipient. Investments in Kenya’s digital economy surged to Sh64.7 billion—nearly five times the 2020 levels—reflecting rising investor appetite for the country’s tech and innovation landscape.

Investors Hold Firm as T-Bill Rates Stay Above 8%

Treasury bill investors kept yields steady in the latest auction, with the 91-day paper settling at 8% despite the Central Bank of Kenya’s recent rate cuts. The 182-day and 364-day papers closed at 8.07% and 9.57% respectively, as the CBK took up Sh24.3 billion against a Sh24 billion target. While lower T-bill rates have eased government borrowing costs compared to longer-dated bonds paying up to 13%, demand for short-term debt has pushed the outstanding stock of T-bills to a record Sh1.06 trillion—16.7% of domestic debt. Read More here.

Banks Under Fire for Delayed Rate Cuts Despite CBK Pressure

Kenya’s top banks are facing criticism for being slow to pass on the Central Bank of Kenya’s (CBK) recent rate cuts to borrowers, despite the regulator’s efforts to stimulate credit growth. In mid-August, the CBK lowered its benchmark rate to 9.5%—the third cut this year—but lending rates remain stubbornly high, limiting access to affordable loans for businesses and households. Analysts note this reflects a longstanding trend where lenders are quick to hike borrowing costs but slow to lower them.

NCBA is the only tier-one lender so far to adjust its base lending rate, trimming it by 25 basis points to 13.52% effective September 20, while other banks remain cautious. According to the CBK’s surveys, firms continue to cite high credit costs as a key obstacle to expansion, with private sector credit growth at just 3.3% in July, far below the 12–15% target. The Standard reports that regulators and businesses are now closely watching whether lenders will align with CBK’s easing cycle ahead of the October MPC meeting.