The National Social Security Fund (NSSF) has reported its strongest financial performance on record in the fiscal year ended 30th June 2025 mainly driven by the phased implementation of the NSSF Act 2013. In the period under review, NSSF witnessed dramatic growth in its asset base and investment returns.
There was a substantial surge in member contributions which grew by 35% from KES 62.29 billion in June 2024 to KES 83.97 billion by June 2025. This growth reversed nearly a decade of stagnation where collections typically hovered between KES 13 billion and KES 16 billion. This expansion was supported by an 8% growth in active membership, which rose from 3.3 million to 3.6 million members over the same period.
Income grew by 152%, reaching KES 105.3 billion in 2025, compared to KES 41.7 billion in 2024. The Fund recorded a 22% nominal return in the 2025 financial year, a significant jump from 12.02% in 2024. Growth was largely concentrated in sovereign fixed income and listed equities. Treasury bond holdings alone expanded by KES 101.6 billion to reach KES 355.4 billion, accounting for nearly 64% of total investment assets. Eurobond holdings also grew sharply from KES 7.2 billion to KES 34.3 billion.
NSSF’s total investment assets grew by 43% (KES 168 billion) to reach KES 558 billion in 2025. Total Member Funds expanded by KES 172.6 billion, reaching KES 572.8 billion as of June 30, 2025. This growth is attributable to both the impressive increased volume of member contributions.
NSSF next phase in Contributions
NSSF’s rapid expansion has direct implications for workers. Middle and higher-income earners are set to experience reduced take-home pay due to higher Tier II deductions. Effective February 1, 2026, NSSF will implement new pensionable earnings bands under the ongoing phased rollout of the NSSF Act. The Lower Earnings Limit (Tier I) will rise to KES 9,000, while the Upper Earnings Limit (Tier II) will increase from KES 72,000 to KES 108,000.
Although the contribution rate remains 6% for both employers and employees, the expanded earnings bands will raise the maximum individual monthly contribution to KES 6,480, up from KES 4,320 in 2025. This brings the maximum combined monthly contribution to KES 12,960. Employees earning at or above the new upper threshold could see their take-home pay decline by up to KES 2,160 per month, in exchange for higher long-term retirement savings.
The trade-off is stronger retirement security through increased individual pension savings. Notably, member benefits paid declined by 10% (KES 977 million) to KES 8.74 billion in 2025, driven by an 11% drop in claim applications (11,893 fewer claims). This decline has further strengthened the Fund’s financial position.
Looking ahead, the outlook for the remainder of the 2026 financial year remains positive, with assets expected to maintain their growth trajectory as the new contribution caps take full effect.
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