The Public Service Superannuation Fund (PSSF), which manages retirement savings for civil servants, teachers, and uniformed personnel, has nearly doubled its value in just one year, reaching Ksh 242 billion in 2025, up from Ksh 142 billion in 2024.
This remarkable growth comes even as the number of pensioners receiving benefits more than tripled during the same period. According to the Fund’s latest financial report, its impressive performance was driven by high returns on state securities, equities, and offshore investments.
“Investment income increased from Ksh 14.054 billion in 2024 to Ksh 25.369 billion in 2025, reflecting a robust 80.5 per cent rise driven by strategic allocations in government securities, equities, and offshore investments,” PSSF board chair, Ambassador Tuneiya Hussein Dado, said.
The Fund’s strong performance was supported by improving market conditions, favourable interest rates, and a stabilising Kenyan shilling.
Kenyan equities rose during the year, backed by solid corporate earnings, while government securities offered high yields, giving pension funds attractive risk-adjusted returns. Offshore investments provided diversification and currency hedging as global markets recovered from post-pandemic shocks.
Historically focused on government securities, the PSSF has deliberately expanded into alternative asset classes, including real estate and private equity, in line with regulatory limits.
The Fund now invests in nine asset classes, up from one at its inception four years ago, a move aimed at ensuring long-term sustainability.
The Fund also benefited from growing membership and contributions. Monthly remittances surpassed Ksh4.2 billion, bringing total annual contributions to Ksh 52.7 billion, an 18 per cent increase from 2024. Membership rose to 505,282 as of June 2025, up from 440,554, thanks to improved compliance and the onboarding of new public sector workers.
As the scheme matures, benefit payments have also risen sharply. Claims paid jumped from Ksh 59.7 million to Ksh 154 million, a 153 per cent increase, reflecting more retirements under the new contributory system.
Equity markets continued to perform well, with the Nairobi All-Share Index climbing 17.3 per cent, reflecting renewed investor confidence and resilient corporate earnings. Offshore investments also paid off, boosted by the strengthening of the Kenyan shilling from Ksh 159.7 to Ksh 129.3 against the US dollar.
On the operational side, the Fund has implemented an aggressive digitisation programme, including the adoption of a new ERP system to automate finance, procurement, human resources, and claims processes.
“Operationally, we have made significant strides in automation to support our growing operations,” PSSF CEO Jonah Aiyabei said.
However, scaling up has increased operational costs, with administration expenses rising 66 per cent from Ksh 424 million to Ksh 708 million. To support expansion, the Fund recruited 44 additional staff and moved to upgraded office premises at CBK Pension Towers.
To strengthen governance and accountability, the PSSF developed and approved 18 policies covering areas such as anti-money laundering, whistleblowing, conflict of interest, ESG, data protection, and risk management.
Looking ahead, the Fund plans to increase investments in real estate, private equity, and infrastructure while expanding its contribution base through innovative products.
Two new savings options, a Trust Fund and a Preserved Retirement Member Fund, have been introduced to offer members more retirement choices.
CEO Aiyabei emphasised the Fund’s commitment to building a “resilient and inclusive retirement system,” highlighting that the 2023–2027 strategic plan prioritises sustainability, financial growth, and digital transformation.
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