Nabo KES Money Market Fund – A Safe, High-Yield Cash Parking Option in Kenya

In today’s fast-changing investment environment, the Nabo KES Money Market Fund has become one of the most practical and reliable tools for investors seeking capital preservation, competitive returns, and liquidity.

With inflation steadily eroding the value of idle cash and bank deposits offering little in the way of meaningful growth, this fund provides a well-balanced alternative that combines safety and yield.

By offering 16–17% net annualized returns in 2025, alongside quick access to invested cash, the Nabo KES Money Market Fund continues to stand out in Kenya’s crowded unit trust space.

This makes it an attractive choice not only for individuals looking to optimize short-term savings but also for corporates, institutions, and high-net-worth clients seeking a safe place to hold operational or reserve funds.

Key Features of the Fund

The Nabo KES Money Market Fund has been deliberately designed with structural features that give investors confidence and a high degree of transparency. These features ensure it meets both regulatory standards and the practical needs of clients.

Fund Manager: Nabo Capital Ltd. – a licensed and respected asset manager in Kenya with a track record of disciplined, research-driven portfolio management.
Fund Structure: Unit Trust regulated by the Capital Markets Authority (CMA), ensuring compliance and investor protection.
Launch Date: November 2017 – now with over seven years of proven performance history.
Fund Size (AUM): KES 4.1 billion as of June 30, 2025, reflecting steady investor confidence and growth in assets.
Benchmark: 3-Month Treasury Bill – the industry’s standard for risk-free returns in Kenya.
Trustee: KCB Bank – safeguarding investors’ interests and ensuring compliance with fund rules.
Custodian: Stanbic Bank – providing secure custody of fund assets.
Auditor: Grant Thornton – conducting independent audits to reinforce accountability.
Portfolio Management Team: Led by Damitha Pathmalal (MBA) with support from Victoria Njoroge, who are both seasoned professionals with deep expertise in fixed-income and money market strategies.

Investor Terms That Inspire Confidence

Minimum Initial Investment: KES 100,000, which makes the fund ideal for serious savers and investors.
Top-ups: Flexible from KES 10,000 upwards, allowing incremental growth of your investment.
Liquidity: Redemptions are processed within 24–48 hours, making it a powerful short-term liquidity tool.
Fees: No entry or exit fees; a management fee of up to 2.25% annually, competitive within the industry.
Reporting: Investors receive monthly statements and monthly fact sheets, ensuring complete transparency on performance and portfolio allocations.

These features illustrate why the Nabo KES Money Market Fund has gained traction: it’s not just about attractive returns, but also about strong governance and client-focused design.

Latest Fund Performance (2025)

Performance is the ultimate test of any fund, and in 2025, the Nabo KES Money Market Fund has continued to deliver. As of June 2025:

Annualized Yield: Averaging 16–17% net of fees – placing it in the same league as Kenya’s best-performing MMFs.
Fund Size: KES 4.1 billion under management, representing a 7% growth compared to 2024.
Market Share: 1.1% of Kenya’s MMF industry – mid-sized, but increasingly respected for its strategy and execution.

This consistency underscores Nabo Capital’s ability to manage funds prudently, taking advantage of high-interest-rate cycles, diversifying across corporate issuers, and carefully balancing exposure between cash, government securities, and debt instruments.

Even during fluctuating economic conditions, the fund has demonstrated resilience, never posting negative returns and always maintaining liquidity for investors. This makes it a solid choice for both individual savers and institutions with treasury management needs.

Portfolio Allocation

The Nabo KES Money Market Fund maintains a conservative yet balanced asset allocation designed to maximize yield without compromising safety.

Asset Class	Allocation (2025)
Cash & Equivalents	~80%+
Corporate Debt	~10–13%
Government Debt	~5–7%

This structure ensures:

High liquidity – The bulk allocation to cash and equivalents allows the fund to meet redemptions quickly.
Yield enhancement – Select corporate debt investments improve overall returns while being carefully vetted to minimize risk.
Capital safety – Exposure to government securities provides a risk-free anchor to the portfolio.

By actively managing this mix, Nabo’s portfolio managers strike the right balance between income generation and investor protection.

Market Position Among Kenyan MMFs

Kenya’s collective investment schemes have grown rapidly, with MMFs now commanding the largest share of assets under management. As of Q2 2025:

Total MMF assets stood at KES 372.8 billion, representing 62.5% of the entire CIS market.
The Nabo KES Money Market Fund held KES 4.1 billion in AUM, representing 1.1% market share and ranking 14th out of over 50 MMFs.

Although it does not yet match the giants like Sanlam (KES 92.7B) or CIC (KES 87.8B), Nabo has carved out a credible space by focusing on performance, transparency, and personalized client service.

For many investors, especially corporates and high-net-worth individuals, Nabo’s smaller size is actually an advantage—allowing for nimbleness and close attention to portfolio management.

Why Choose the Nabo KES Money Market Fund?

Attractive Double-Digit Yields – With 16–17% net returns in 2025, the fund comfortably outpaces bank savings accounts and most fixed deposits.
Capital Preservation – Investments are restricted to low-risk, short-term securities, ensuring that investors’ principal remains safe.
Unmatched Liquidity – Unlike fixed deposits that tie up capital, Nabo MMF allows access to funds within 48 hours, making it a highly flexible tool.
Regulatory Oversight – The fund is under CMA regulation and supported by a trustee, custodian, and auditor, offering investors a high degree of protection.
No Hidden Costs – With no entry or exit fees and a transparent fee structure, investors get maximum value.
Professional Management – Backed by Nabo’s experienced investment team, with a disciplined approach to risk and return.
Investor Confidence – Steady growth in AUM demonstrates growing trust in the fund.

These strengths explain why the Nabo KES Money Market Fund is increasingly seen as a credible cash management solution for both individuals and institutions.

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Risks to Consider

Although money market funds are among the safest investment products, they are not entirely risk-free. Key risks include:

Interest Rate Risk: Changes in market interest rates can cause fluctuations in the fund’s yield. In periods of declining rates, future returns may compress.
Liquidity Risk: A portion of the fund is invested in corporate debt, which may occasionally have reduced liquidity. However, Nabo maintains a high cash buffer to mitigate this.
Taxation: Returns are subject to a 15% withholding tax on interest income, which reduces the final net yield to investors.

Despite these risks, the Nabo KES Money Market Fund remains a low-risk investment class, actively managed to protect capital while generating stable returns.

How to Invest in Nabo KES MMF

Getting started with the fund is straightforward:

Download Application Forms – Available directly on the Nabo Capital website.
Provide KYC Documents – National ID/Passport, KRA PIN, and proof of address.
Deposit Funds – Make an initial contribution of at least KES 100,000 via bank transfer or cheque.
Top Up Anytime – Add further contributions from KES 10,000 onwards.
Track Your Investment – Receive monthly statements and updated fact sheets to monitor performance.

The combination of simplicity and transparency makes the fund easily accessible to retail, corporate, and institutional investors.

Side-by-Side Comparison with Other MMFs (Q2 2025)

Fund Manager	AUM (KES Bn)	Market Share	Yield (2025)
Sanlam MMF	92.7	24.9%	~16–17%
CIC MMF	87.8	23.6%	~15–16%
Absa MMF	23.1	6.2%	~15–16%
ICEA MMF	20.2	5.4%	~15–16%
Nabo KES MMF	4.1	1.1%	~16–17%

This comparison highlights that while Nabo’s market share is modest, its yield competitiveness makes it a serious player in the MMF landscape.

FAQs on Nabo KES Money Market Fund

1. What is the minimum amount required to invest in the Nabo KES MMF?

The minimum entry is KES 100,000, with flexible top-ups starting from KES 10,000. This ensures accessibility while maintaining a serious investor base.

2. How quickly can I withdraw money from the fund?

Redemptions are processed within 24–48 hours, making the fund far more liquid than fixed deposits or bonds that lock up funds. This liquidity is one of the strongest selling points of MMFs.

3. How does the Nabo KES MMF compare to bank deposits?

While most Kenyan banks pay between 3–8% interest on deposits, the Nabo KES MMF delivered ~16–17% in 2025. This means your money grows significantly faster while remaining safe and accessible.

4. Is the fund safe?

Yes. The fund invests in government securities, top-tier corporate debt, and fixed deposits. While not entirely risk-free, it is CMA-regulated and managed under strict oversight by a trustee, custodian, and auditor. This makes it far safer than informal savings or speculative schemes.

5. How are the returns taxed?

Income earned from the fund is subject to a 15% withholding tax (WHT). This tax is automatically deducted before distributions are made, so investors receive their net return seamlessly without additional tax filing obligations.