Kenya’s Collective Investment Schemes (CIS) market continued its shift toward low-risk assets in the third quarter of 2025, with Money Market and Special Funds strengthening their dominance as total industry assets rose to Sh679.6 billion, new data from the Capital Markets Authority (CMA) shows.

Money Market Funds (MMFs) remained the largest segment, expanding to Sh400 billion — 58.9 percent of all assets under management (AUM). CMA attributes the sustained appeal of MMFs to investors’ preference for stability amid a challenging macroeconomic environment.

“Money Market Funds dominate the CIS market at Kshs 400 billion, representing 58.9 percent of the total AUM,” the report notes, citing their low-risk profile as the key driver of demand.

A notable shift in the quarter was the rapid rise of Special Funds, which have now overtaken traditional Fixed Income Funds to become the second-largest category. Special Funds grew 22 percent to Sh137.8 billion, accounting for 20.3 percent of the market.

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Fixed Income Funds also posted strong momentum, rising 29 percent to Sh136.7 billion, or 20.1 percent of total assets.

Equity and Balanced Funds remained marginal players at 0.5 percent and 0.2 percent of AUM respectively, reflecting subdued risk appetite among retail investors amid elevated interest rates and inflation.

The report also shows the broader market continues to expand, with 55 licensed CIS operators and 234 registered funds, though only 41 are currently active.

Analysts say the surge in Special Funds indicates a growing preference for flexible investment structures that allow fund managers to diversify across asset classes beyond traditional mandates.

Overall, the CIS industry grew 14 percent between June and September, underscoring its rising importance in mobilising domestic savings during a period of tight financial conditions.