Kenya’s Capital Markets Authority (CMA) has approved 16 investment funds across six asset managers in one of the regulator’s largest single-batch approvals in recent memory. Announced on 26 May 2026, the approvals span unit trusts, special funds, and an alternative investment fund, covering asset classes from money market and fixed income instruments to equities, derivatives, and private debt. The wave of new products arrives as Kenya’s collective investment scheme (CIS) industry has ballooned to KSh 756.20 billion in assets under management, with investor accounts surpassing 3.2 million — a figure that more than doubled in 2025 alone. The approvals also include a pioneering alternative fund targeting the SACCO ecosystem, a sector managing over KSh 1.2 trillion in assets.
Key Overview
- Funds Approved: 16 across six asset managers
- Date Announced: 26 May 2026
- Fund Types: Unit trusts, special funds, and one alternative investment fund
- Industry AUM: KSh 756.20 billion as at December 2025, up 1,236% from KSh 56.60 billion in March 2018
- CIS Investors: 3,224,130 by end of 2025, up 128.8% year-on-year
- Special Funds Share: 21.5% of total industry AUM (KSh 162.40 billion)
- Key Entrants: Pergamon Investment Bank (6 sub-funds), EDC Asset Management (5 sub-funds), Capital A Investment Bank (2 sub-funds), Faida Investment Bank (1 alternative fund), Meridian Asset Management (1 special fund), Nabo Capital (1 fund conversion)
Kenya’s Capital Markets Authority has approved 16 new investment funds across six licensed asset managers, delivering one of the largest single-batch product approvals the regulator has issued. The approvals, announced on 26 May 2026, span unit trust schemes, special funds, and an alternative investment fund, covering risk profiles ranging from conservative money market vehicles to actively managed multi-asset strategies, private debt, equities, and derivatives.
The CMA said the move forms part of ongoing efforts to deepen Kenya’s capital markets, encourage innovation, and expand access to investment services across retail, institutional, diaspora, and high-net-worth investor segments. The batch arrives at a time when the country’s collective investment scheme industry is experiencing exceptional growth — and when the regulator is simultaneously clamping down on a rising tide of unlicensed investment fraud.
Who Got Approved: A Breakdown of the Six Managers
The largest single addition comes from Pergamon Investment Bank Limited, which secured approval for six sub-funds under the newly created Pergamon Unit Trust Scheme. The lineup covers Kenya shilling and US dollar money market strategies, an equity fund, a fixed income fund, a balanced fund, and a special diversified income fund denominated in Kenya shillings.
EDC Asset Management (Kenya) Limited enters the market with five sub-funds under the EDC Kenya Unit Trust Funds umbrella, spanning money market, fixed income, dollar income, balanced, and equity strategies. The entry of EDC adds another player to an increasingly competitive landscape where, as at September 2025, the top five schemes controlled 63.7 percent of total industry assets, according to CMA quarterly data.
Capital A Investment Bank Limited received approval for two sub-funds under its existing Capital A Unit Trust: the Capital A Multi Asset Strategy Special Fund in both Kenya shilling and US dollar denominations. Both funds will pursue an actively managed, event-driven multi-asset strategy targeting investors seeking diversified cross-asset exposure.
Meridian Asset Management Limited debuts with the Meridian Kenya Shilling Total Return Special Fund, which will target maximum absolute returns through a combination of capital appreciation and income generation. Nabo Capital Limited rounds out the approvals with the conversion of the Nabo Africa Balanced Fund (USD) into the Nabo Ubuntu Special Fund, which will pursue long-term capital appreciation through dynamic multi-asset allocation across equities, fixed income, derivatives, commodities, currencies, and fund-of-funds structures.
The KETSA Alternative Fund: A Bridge to the SACCO Sector
Perhaps the most structurally significant approval in the batch is the KETSA Alternative Investment Fund, secured by Faida Investment Bank Limited. Established under the Capital Markets (Alternative Investment Funds) Regulations, 2023, the fund will invest across private debt, equities, money market instruments, and fixed income securities, with a stated focus on intermediating institutional capital into Kenya’s SACCO ecosystem.
This is a notable development. Kenya’s regulated SACCO sector is substantial — by December 2025, total industry assets had grown to KSh 1.21 trillion, up from KSh 1.08 trillion the prior year, according to SASRA. The sector now counts 7.8 million members and has historically played a central role in financial inclusion, particularly for salaried workers and agricultural communities. However, SACCOs have had limited access to formal capital markets intermediation, facing challenges including high technology costs, liquidity constraints, and fragmented systems. The KETSA fund represents an attempt to build a regulated bridge between institutional capital and this vast cooperative sector.
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An Industry in Overdrive
The 16 new funds land in a CIS industry that has transformed almost beyond recognition over the past seven years. Total assets under management reached KSh 756.20 billion as at December 2025, a staggering 1,236 percent increase from KSh 56.60 billion in March 2018. The number of CIS investor accounts more than doubled in 2025 alone, rising 128.8 percent to reach 3,224,130 by year-end — up from roughly 171,904 investors just four years earlier.
Money market funds continue to dominate, but their share of total AUM has declined from above 90 percent in 2021 to around 59 percent by the third quarter of 2025, as investors increasingly diversify into higher-yielding alternatives. Special funds — a category that barely registered before 2023 — have emerged as a major growth segment, now accounting for 21.5 percent of total industry AUM at KSh 162.40 billion. Several of the newly approved products, including the Pergamon Special Diversified Income Fund, the Capital A Multi Asset Strategy funds, the Meridian Total Return fund, and the Nabo Ubuntu Special Fund, are positioned squarely within this fast-growing category.
The growth has been fuelled by a combination of factors: improved digital access through mobile-first investment platforms, sustained marketing and investor education by fund managers, the entry of new product types under umbrella schemes, and a rate environment that has made money market returns attractive relative to traditional bank savings. As the CMA noted in its Q3 2025 quarterly report, the increase reflects both organic growth reported by existing funds and additional funds registered under established umbrella schemes.
Regulatory Push and Pull
The approvals come just weeks after the CMA issued a pointed investor alert on 8 May 2026, warning Kenyans against investing through unlicensed money market funds, forex platforms, and cryptocurrency schemes following a surge in fraud cases. The regulator cautioned that investors who channel funds through unregulated entities risk losing their entire investment, stressing that it cannot intervene or recover money placed with firms operating outside the Capital Markets Act.
The juxtaposition is telling: even as the CMA expands the range of regulated products available to Kenyan investors, it is contending with a parallel economy of unlicensed operators exploiting the same appetite for higher returns that is driving the legitimate CIS boom. The regulator urged the public to verify licensing status through its official online register before investing and to report suspicious entities to the Capital Markets Fraud Investigation Unit.
This dual approach — broadening the regulated market while cracking down on unregulated operators — reflects a deliberate strategy. In February 2026, the CMA had already licensed six new market intermediaries spanning investment banking, stockbroking, investment advisory, and fund management, signalling a sustained push to deepen the regulated ecosystem and attract broader domestic participation.
What It Means for Investors
The 16 new funds meaningfully expand the toolkit available to Kenyan investors. The inclusion of dollar-denominated options from Pergamon, EDC, and Capital A addresses growing demand for foreign currency investment vehicles as Kenyans seek protection against currency volatility. The multi-asset and special fund structures — now representing a fifth of industry AUM — offer more sophisticated exposure for investors comfortable with higher risk in exchange for potentially greater returns.
The KETSA Alternative Investment Fund, meanwhile, opens an entirely new channel for institutional capital to flow into Kenya’s cooperative sector, potentially improving liquidity and governance within the SACCO ecosystem while offering investors exposure to a KSh 1.2 trillion asset base that has historically been walled off from formal capital markets.
The CMA advised investors to familiarise themselves with any scheme before committing capital and to deal only with licensed and approved intermediaries — a reminder that, even in a market growing at over 1,000 percent in seven years, due diligence remains the first line of defence.
Sources: HapaKenya / Kenyans.co.ke / Kenyan Wall Street / People Daily / Fineducke / Business Today Kenya / Sacco Review / SASRA / FSD Kenya / The Kenya Times / Serrari Group / Tuko.co.ke
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