World Bank: Why we awarded Kenya Sh97.12 billion loan

The World Bank has approved a Sh97.12 billion (US$750 million) financing package for Kenya, saying the funds will support reforms aimed at strengthening governance, improving public financial management and expanding social protection for vulnerable households.

The financing, approved on Monday, forms part of the lender's broader support for Kenya's fiscal sustainability and resilient growth agenda, with the World Bank saying the reforms are expected to improve accountability, reduce corruption, attract private investment and create jobs.

The approval comes just 12 days after President William Ruto met World Bank President Ajay Banga on the sidelines of the G7 meetings in France on June 17.

It also comes nine days after Kenya successfully unlocked a JP¥25 billion (about Sh22 billion) Samurai Bond, marking another milestone in the country's external financing programme.

The Sh97.12 billion facility is part of a cumulative US$1.25 billion (about Sh161.86 billion) financing package earmarked for Kenya and aligns with the government's 2025-26 borrowing plan.

According to the World Bank, the financing is being provided through the Second Kenya Fiscal Sustainability and Resilient Growth Development Policy Operation, which combines a US$340 million loan from the International Bank for Reconstruction and Development (IBRD) and US$410 million in highly concessional financing from the International Development Association (IDA).

Part of the concessional funding is dedicated to supporting livelihoods for refugees and host communities, with a key pillar of the programme being strengthening governance through measures designed to curb conflicts of interest and reduce corruption in public institutions.

In awarding the financing, the World Bank cited Kenya's enactment of the Conflict of Interest law and the gazettement of the Conflict of Interest Regulations 2026, saying the new framework establishes clear rules for preventing, detecting and investigating situations where public officials could use their positions for personal gain.

The regulations introduce tougher penalties and stronger disclosure requirements aimed at closing loopholes that have historically allowed conflicts of interest to go unchecked.

The lender further noted that the government has directed all ministries, departments and agencies to operate through the Treasury Single Account, a move expected to reduce idle cash held in fragmented accounts, minimise costly overdrafts and give the National Treasury greater visibility over government cash balances.

According to the World Bank, the reforms are also expected to limit leakages and misuse of public funds while strengthening overall fiscal discipline.

The programme additionally supports the rollout of electronic government procurement systems to make public contracting more transparent, competitive and easier to audit.

The World Bank said digitising procurement is further expected to reduce corruption risks, increase supplier competition and lower procurement costs.

World Bank Division Director for Kenya, Qimiao Fan, said the operation is intended to ensure public resources deliver better value while laying the groundwork for stronger private sector-led growth.

"By supporting reforms to address conflicts of interest, strengthen procurement systems, improve public financial management and expand social protection, this operation will help Kenya reduce leakage, generate fiscal savings and ensure that public resources deliver better results and reach the people who need them most," Fan said.

"It is also helping establish the foundational, business-enabling environment that is necessary to support higher and more inclusive growth and for the private sector to create jobs," he added.

Beyond governance reforms, the financing also supports implementation of the Social Protection (General) Regulations 2026, which establish a clearer framework for delivering social assistance for retired senior citizens.

The programme further backs the use of Kenya's Enhanced Single Registry as the primary platform for identifying beneficiaries, a move intended to ensure assistance reaches the poorest households while reducing duplication across social protection programmes.