Kenya’s deposit administration (DA) funds recorded strong growth in both assets and returns in 2025, reflecting rising confidence among retirement scheme trustees and sponsors seeking stable long-term investment options amid economic uncertainty.
A new Survey of Insured Deposit Administration Returns released by Zamara Group shows that total assets held under deposit administration arrangements rose to approximately KSh475.2 billion by the end of 2024, compared to KSh399.3 billion in 2023.
The growth extends the long-term expansion of Kenya’s retirement benefits industry, with guaranteed investment solutions increasingly gaining traction among pension schemes.
According to the survey, annual contributions into DA funds surged by 34 per cent to KSh88.8 billion in 2024, marking the strongest growth recorded over the last decade.
The report attributed the sharp increase to stronger inflows into guaranteed funds following changes in NSSF contribution rates, improved declared interest rates and expected uptake driven by enhanced pension tax incentives introduced in late 2024.
Speaking on the findings, Neha Datta said the sustained growth of DA funds underscores the increasing importance of guaranteed investment solutions within retirement schemes, especially during periods of market volatility.
“The strong growth in both contributions and assets under deposit administration arrangements demonstrates growing confidence among retirement scheme sponsors and trustees in guaranteed funds as a stable long-term savings vehicle,” she said.
Read Also: Next Phase of Kenya’s Mobile Money Success Story is Overcoming Fragmentation
Gachagua DCP Ol Kalou MP Ticket Fee Raised to Ksh250,000
She noted that trustees are increasingly prioritising investment structures that offer predictability, downside protection and competitive declared returns.
The survey further showed that the average declared return for DA funds improved to 12.3 per cent in 2025, up from 11.4 per cent in 2024 and 8.9 per cent in 2023.
Analysts linked the improved performance to a relatively stable interest rate environment as well as a recovery in equity and offshore asset class returns.
The study, which covered 17 insurance companies offering deposit administration services in Kenya over a minimum five-year reporting period, also highlighted resilient long-term industry performance.
The five-year industry average declared return stood at 10.1 per cent, with provider averages ranging between 5.9 per cent and 11.8 per cent annually.
Meanwhile, the 10-year industry average declared return came in at 9.4 per cent, with annualised returns ranging between 5.6 per cent and 11.3 per cent per annum.
Group pension schemes remained the largest contributors to DA funds, accounting for 54 per cent of total contributions in 2024. Personal pension plans contributed 24 per cent, while umbrella schemes accounted for 22 per cent, highlighting the growing influence of institutional retirement savings in driving the sector’s growth.
The report also examined risk-adjusted performance and return variability among providers, noting that volatility differences were largely influenced by varying investment mandates, client profiles and insurer risk appetites.
Zamara noted that while deposit administration funds continue to offer guaranteed minimum returns and professional fund management, pension trustees should assess providers based on long-term consistency, governance standards, return volatility and alignment with scheme objectives.
