Kenya’s Idle-Cash Sweep Has Already Stopped Paying
KENYA · PUBLIC FINANCE
Key Facts
- —The policy The National Treasury is consolidating government balances held in commercial banks under a hybrid Treasury Single Account.
- —The status The account-visibility system was still in testing in September 2025.
- —The one-off gain Non-tax revenue reached Sh122.31 billion (about US$945 million) in the nine months to March 2025, up 135.15%.
- —What happened next In the nine months to March 2026 it fell 10.65% to Sh109.3 billion (about US$844 million).
- —The dispute Treasury called the account data banks submitted insincere. A 2024 survey found banks declaring fewer than 22,000 government accounts against a Treasury estimate near 190,000.
- —The rule State corporations may retain 10% of operating surplus. Commercial state enterprises were ordered to remit 80% of after-tax profit.
The sweep produced a spike, not a stream. Non-tax revenue has already fallen back, and the accounts it came from are still being counted.
Kenya’s National Treasury has spent three years pulling idle public money out of commercial banks and into central government control, and the revenue it produced has turned out to be a one-off.
What Treasury Is Building
Kenya is rolling out a hybrid Treasury Single Account, under which some public entities keep their commercial bank accounts while the balances become visible to the Central Bank of Kenya.
As of 4 September 2025 the system was still in testing, according to Treasury’s director of accounting services, Jonah Wala, with a committee still working on what should count as idle cash. Describing the sweep as complete would be premature.
The underlying problem is one of visibility rather than of ownership. Money belonging to the state sitting in hundreds of accounts across the banking system is money the exchequer cannot plan around.
The Windfall, and the Reversal
Non-tax revenue reached Sh122.31 billion (about US$945 million) in the nine months to March 2025, an increase of 135.15% from Sh52.01 billion (about US$402 million) in the same period a year earlier.
That surge did not hold. Treasury data for the nine months to March 2026 shows non-tax receipts fell 10.65% to Sh109.3 billion (about US$844 million), the first contraction under President William Ruto, as surplus sweeps and digital-payment fees proved unrepeatable.
The pattern is the ordinary one for a stock transfer. Collecting accumulated balances raises revenue once; it does not raise the rate at which balances accumulate.
What the Banks Said, and What Treasury Said Back
Government deposits in commercial banks stood at Sh435.87 billion as at 31 December 2022, then equivalent to about US$3 billion, or 8.69% of total bank deposits of Sh5.01 trillion. A Treasury official put government cash at 8% to 10% of sector deposits in September 2025.
In January 2025 Treasury dismissed as insincere the account data the banks had submitted. A baseline survey commissioned in April 2024 found banks declaring fewer than 22,000 government accounts against a Treasury estimate of roughly 190,000.
That gap is the practical obstacle. A consolidation programme cannot sweep accounts it has not been told about, and the discrepancy is nearly nine to one.
The Rules Behind the Sweep
Under the Public Finance Management Act, state corporations may retain only 10% of operating surplus and must remit the balance. President Ruto separately ordered commercial state enterprises to remit 80% of after-tax profits and regulatory agencies 90% of surplus funds.
Those obligations predate the consolidation programme. What changed was enforcement, and enforcement is what produced the 2025 figures.
The County Money Is a Different Pool
Counties had Sh48.5 billion (about US$375 million) sitting idle in the County Revenue Fund account at the Central Bank as of January 2025, according to Controller of Budget Margaret Nyakang’o.
That money is held at the Central Bank rather than in commercial banks, so it is outside the pool this programme targets, and it is frequently conflated with it. Separately, 177 parastatals held Sh201.05 billion (about US$1.55 billion) in commercial banks as of December 2023.
What to Watch
Treasury’s full-year figures to June 2026 will show whether non-tax collections stabilise near the Sh100 billion mark or continue sliding after the March contraction.
The more consequential number is the account count. Until Treasury and the banks agree on how many government accounts exist, the size of the pool remains an estimate rather than a measurement.
More: Africa news in English, every day from The Rio Times.
Frequently Asked Questions
What is Kenya doing with idle state cash?
Consolidating government balances held in commercial banks under a hybrid Treasury Single Account, with balances visible to the Central Bank.
Did it raise revenue?
Once. Non-tax revenue rose 135.15% to Sh122.31 billion (about US$945 million) in the nine months to March 2025.
Is that still happening?
No. Receipts fell 10.65% to Sh109.3 billion (about US$844 million) in the nine months to March 2026.
What is the dispute with banks?
Treasury called the banks’ account data insincere. Banks declared fewer than 22,000 government accounts; Treasury estimated about 190,000.
How much do counties hold?
Sh48.5 billion (about US$375 million) in the County Revenue Fund at the Central Bank as of January 2025 — a separate pool.
Sources: Business Daily Africa, The EastAfrican, Nation Africa, Controller of Budget, Public Finance Management Act.
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