Top Performers and Recent Trends

Kenya’s money market funds (MMFs) continued to attract investor attention in September 2025, with several funds posting competitive yields despite broader market pressures.

• Cytonn Money Market Fund (CMMF) led the pack with an effective annual yield of 13.04% as of September 11, 2025, positioning itself as one of the highest-yielding funds in the country.
  
• Ndovu and Nabo Africa also featured among the top performers according to the Kenya Money Market Funds Portal. Nabo, with its relatively high minimum investment threshold of KES 100,000, remains particularly attractive to institutional clients and high-net-worth individuals.
  
• Sanlam Money Market Fund, following its rebrand to Sanlam Allianz Investments, overtook CIC in Q2 2025 to become the largest MMF in Kenya. This milestone marked a significant shift in market dominance.

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However, Cytonn’s strong returns have been accompanied by renewed calls for investor caution. Regulatory reminders from the Capital Markets Authority (CMA) emphasized the importance of due diligence, citing Cytonn’s history of compliance challenges.

Market Forces Shaping Performance

Several structural and policy-driven factors have influenced the performance of MMFs this month:

• Declining Yields: Since the start of 2025, MMF yields have gradually softened, largely reflecting lower returns on government securities such as Treasury Bills. The downward trend has also been reinforced by easing inflation.
  
• Central Bank Policy Shift: On September 1, 2025, the Central Bank of Kenya (CBK) rolled out its revised risk-based credit pricing model. Under the new system, variable-rate loans are now pegged to the Kenya Shilling Overnight Interbank Average (KESONIA) index, designed to provide a more accurate reflection of short-term interbank borrowing costs. This shift is expected to have ripple effects on liquidity and MMF pricing strategies.
  
• Rebranding Momentum: Sanlam Kenya’s rebrand to Sanlam Allianz Investments Limited, after its joint venture with global financial powerhouse Allianz, signals both international investor confidence and a repositioning of Kenya’s fund management industry on the global stage.

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Investor Guidance and Strategies

With yields trending downward, financial experts are advising investors to carefully adapt their strategies:

• Diversification: Investors are increasingly encouraged to spread their assets across different vehicles, including dollar-denominated MMFs, which have surged in popularity as a hedge against shilling depreciation and inflationary pressures.
  
• Risk Awareness: Although MMFs remain relatively low-risk and highly liquid compared to other financial instruments, analysts caution that not all funds are equal in their performance. Market fluctuations, fund size, and management strategies all contribute to variations in yield outcomes.

Overall Market Snapshot

Despite these shifts, Kenya’s MMF market remains resilient and continues to dominate the wider Collective Investment Schemes (CIS) sector.

• High Liquidity: CBK’s September bulletins highlighted that interbank markets and trading volumes remained robust, underscoring the role of MMFs in maintaining liquidity across the financial system.
  
• Retail Investor Preference: MMFs are still the go-to option for small savers seeking stability, accessibility, and returns higher than traditional savings accounts. Their combination of short-term flexibility and high liquidity continues to drive demand.
  
• Enduring Market Dominance: Even under yield pressure, MMFs have cemented their place as the most popular investment choice in Kenya’s capital markets, bridging both retail and institutional segments.

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