Pesa Pulse

Both instruments fit the conservative profile needed for emergency savings, yet they differ in meaningful ways on yield, access speed, and underlying safety. Here is a clear comparison using the most recent available data from January 2026 auctions and fund reports.

Treasury Bills still anchor the risk-free rate spectrum. In the latest Central Bank of Kenya auctions:  

91-day paper settled around 7.7 percent.  

182-day paper came in near 7.8 percent.  

364-day paper delivered approximately 9.2 percent, with some bids accepted slightly below the 10 percent mark that prevailed in prior years.  

These figures represent yields to maturity for investors buying at auction or in the secondary market.  

Money Market Funds, which allocate heavily to Treasury Bills alongside fixed deposits, repurchase agreements, and select commercial paper, have maintained stronger effective returns for everyday investors. Leading funds report annualized yields between 11 percent and 12 percent as of late January 2026.  

Arvocap Money Market Fund frequently quoted around 11.8 to 12.0 percent.  

Cytonn Money Market Fund often in the 11.7 to 11.9 percent range.  

Nabo Africa Money Market Fund typically near 11.6 percent.  

The average for the top tier of regulated funds sits between 11.0 percent and 11.5 percent, delivering a consistent 2 to 4 percentage point advantage over Treasury Bills of similar duration. This premium stems from professional portfolio management and modest allocation to slightly higher-yielding but still high-quality instruments.

Emergency savings require money to be available quickly and without surprise costs.  

Treasury Bills commit capital until maturity. Auctions occur weekly for shorter tenors, but early exit demands selling in the secondary market, where prices can vary with rate movements and broker fees apply. In a genuine emergency, this process can take several days and may result in a small capital adjustment.  

Money Market Funds offer superior flexibility. Most providers process redemption requests on the same day or next business day, with funds transferred via M-Pesa, bank transfer, or mobile app. There are typically no lock-in periods or withdrawal penalties, allowing you to access cash for urgent needs such as hospital bills or urgent travel without friction.

Safety remains the cornerstone of any emergency fund decision.  

Treasury Bills carry the lowest possible credit risk in Kenya. They represent direct obligations of the national government, with repayment prioritized in the budget process. Principal is virtually guaranteed at maturity, and the only meaningful risk involves interest rate shifts if sold before term or inflation outpacing returns over time.  

Money Market Funds do not enjoy explicit government backing. They operate under Capital Markets Authority oversight, maintain diversified portfolios of short-term, high-quality securities, and target a stable net asset value. While Kenyan funds have an excellent track record with no instances of principal loss in recent memory, theoretical market stress could introduce minor fluctuations. In practice, top funds stay heavily weighted toward government securities, keeping risk extremely low and close to that of direct Treasury Bills.

If maximum certainty of principal and a willingness to hold for at least three months (preferably twelve months for improved yield) define your priorities, Treasury Bills remain the purist choice. The 364-day rate near 9.2 percent still exceeds conventional savings accounts while offering unmatched government assurance.  

For the majority of Nairobi-based savers and other Kenyans managing emergency reserves, Money Market Funds provide the more practical solution. The combination of higher effective yields, near-instant liquidity, and straightforward access through familiar channels outweighs the marginal increase in risk, especially when selecting well-established, CMA-regulated providers with strong government paper exposure.  

Many readers adopt a hybrid strategy: keep the core emergency portion in a high-yield Money Market Fund for immediate access, then allocate a smaller slice to longer-dated Treasury Bills to capture extra return on funds unlikely to be touched soon.  

Monitor developments closely. The Monetary Policy Committee may adjust the CBR later in 2026 depending on inflation trends and global pressures, which could narrow or widen the yield gap. For the current environment in January 2026, Money Market Funds generally deliver stronger overall value for emergency cash that must remain safe yet productive.