Kenya · Central Bank of Kenya
Kenya Treasury Bonds
Treasury bonds are how the Government of Kenya borrows for the long term — and one of the steadiest returns available to ordinary investors. Here is what they pay, how to buy them, and how they're taxed.
- Issuer
- Central Bank of Kenya, for the National Treasury
- Where to buy
- DhowCSD, or any commercial bank
- Minimum
- KES 50,000 face value
- Tenors
- 2, 5, 10, 15, 20, 25 or 30 years, plus IFBs
- Coupon
- Fixed, paid every six months
- Auctions
- Bids close Wednesday, monthly
- Settlement
- ~T+3 — the following Monday
01What are Kenya treasury bonds?
A treasury bond is a loan you make to the Government of Kenya. In return you receive a fixed interest payment — the coupon — every six months, and your full capital back when the bond matures. They are issued by the Central Bank of Kenya on behalf of the National Treasury, which makes them among the lowest-risk instruments in the market.
Tenors run from 2 to 30 years. A special category, infrastructure bonds (IFBs), funds public projects and carries a valuable perk: the interest is free of withholding tax.
02Treasury bond rates in Kenya
There is no single “treasury bond rate.” Each bond's coupon is set when it is first issued, and its yield is decided at the monthly auction by what investors bid. Kenyan bond yields have recently been among the highest for government securities in the region, but they move with every issue.
For live figures, always read the current prospectus rather than trust a number on any page (including this one): CBK treasury bonds and DhowCSD.
03Auction day & settlement
Each month's prospectus sets its own dates, but the pattern is consistent: bidding closes on a Wednesday at 10:00am, and — if your bid is successful — settlement falls on the Monday that follows, about three business days later. Treasury bills, by contrast, are auctioned every Thursday, also settling the following Monday. Payment instructions are issued through DhowCSD once results are announced.
04How to buy treasury bonds in Kenya
- 1
Open a CDS account
Register on DhowCSD (the Central Bank's online platform) or open a Central Depository System account through your commercial bank. You need a Kenyan bank account and a KRA PIN.
Foreign or diaspora investor? See below ↓ - 2
Read the monthly prospectus
Each month the CBK publishes a prospectus for the bonds on offer — the tenor, coupon and the auction date. New issues and re-openings of existing bonds both appear here.
- 3
Place your bid
Submit a competitive bid (you name the yield you'll accept) or a non-competitive bid (you accept the weighted average rate). Most individual investors bid non-competitively.
- 4
Pay for accepted bids
If your bid is successful, settle the amount by the date in the prospectus. The bond is credited to your CDS account.
- 5
Collect coupons, then principal
Interest lands in your bank account every six months; the face value is repaid at maturity. Coupons can be reinvested into the next auction.
05Returns & tax
Your return is the coupon, paid twice a year, plus the face value at maturity. The withholding tax rate depends on the bond's tenor — but not on who's investing:
| Investor type | Rate | Is it final? |
|---|---|---|
| Resident individual | 15% (<10yr) / 10% (≥10yr) / 0% IFB | Yes, final |
| Resident company | 15% (<10yr) / 10% (≥10yr) / 0% IFB | No — credited against the 30% corporate income tax bill |
| Non-resident | 15% (<10yr) / 10% (≥10yr) / 0% IFB | Yes, final |
Infrastructure bonds (IFBs) are exempt from withholding tax altogether for every investor type, which is why their effective yield often beats a higher-coupon ordinary bond.
Often unclear — here's the answer
For foreign & diaspora investors
- Yes — non-residents can buy. Open a Central Bank CDS account and choose the “Foreign Investor (FI)” category, with your passport.
- The KRA PIN is the real hurdle. Every investor needs a KRA PIN (Kenya's tax ID). A non-resident registers on iTax but must appoint a Kenya-resident tax representative — a licensed local tax agent — to obtain and hold it; reckon on a few weeks. Diaspora Kenyans can usually register with their national ID instead.
- You can open it from abroad. DhowCSD lets diaspora and foreign investors register and bid online — no need to be in Kenya.
- A Kenyan-shilling account is required. Settlement, coupons and redemptions are paid in KES, so you (or a custodian) need a local bank account.
- The withholding tax is your final tax. For non-residents without a permanent establishment in Kenya, the 15% deducted at source (10% on bonds of ten years or more) settles your Kenyan liability.
- Your money isn’t trapped. Kenya has no exchange controls, so coupons and principal repatriate freely. You convert KES back to your currency — so exchange-rate moves affect your real return.
Rules and rates change — verify against the CBK, NSE and KRA before you commit. This is information, not tax or investment advice.
06Common questions
What is the minimum amount to buy a treasury bond in Kenya?
KES 50,000 face value for most treasury bonds, in multiples of KES 50,000. Infrastructure bonds (IFBs) have a higher minimum of KES 100,000. Confirm the figure in each bond's prospectus on DhowCSD.
How are treasury bonds taxed in Kenya?
Interest is subject to a 15% withholding tax, falling to 10% for bonds with a tenor of at least ten years. Infrastructure bonds (IFBs) are exempt from withholding tax, which is why their effective return is often higher than the coupon suggests.
How often are treasury bonds issued?
The Central Bank of Kenya runs bond auctions monthly, either issuing new bonds or re-opening existing ones. The prospectus for each auction is published on the CBK website and DhowCSD.
What is the difference between a treasury bond and a treasury bill?
Treasury bills are short-term (91, 182 or 364 days) and sold at a discount with no coupon. Treasury bonds run 2 to 30 years and pay a fixed coupon every six months until they mature.
What tenors does the Central Bank of Kenya offer?
Ordinary treasury bonds run 2, 5, 10, 15, 20, 25 and 30 years, all paying a fixed coupon every six months. Infrastructure Bonds (IFBs) are issued separately, at various tenors, and are exempt from withholding tax.
Do foreigners or companies pay a different tax rate on Kenyan treasury bonds?
No — the 15% (or 10%, for bonds of ten years or more) withholding tax applies equally to residents, non-residents, individuals and companies, and IFBs are tax-free for everyone. The difference is what happens next: a resident company credits the tax against its 30% corporate income tax bill, while for an individual or a non-resident it's the final tax.
Hold more than one bond? See them as one number.
Tamias totals every treasury bond, bill and stock you own across Kenya and East Africa, computes your true return after tax, and nudges you before each coupon and maturity — so matured money never sits idle.
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