Kenya's domestic debt hit Sh7 trillion, here is how fast it got there

Kenya's domestic debt crossed Sh7 trillion for the first time in February 2026, reaching Sh7.052 trillion as at February 20, according to Central Bank of Kenya (CBK) data.

The number itself is a record.

But the pace at which it arrived tells a more revealing story.

When President Uhuru Kenyatta was sworn in on April 9, 2013, the country's domestic debt stood at Sh1.023 trillion.

In the decade that followed, it grew to Sh4.342 trillion by the time he handed power to President William Ruto in September 2022, an addition of Sh3.319 trillion over 10 years.

Ruto's administration has moved faster. Since September 2022, domestic debt has grown by approximately Sh2.71 trillion in under three and a half years, reaching Sh7.052 trillion by February 2026.

The sharpest surge has been the most recent.

Domestic debt crossed the Sh6 trillion mark for the first time on February 14, 2025.

Twelve months later, it had added another trillion.

Between December 24, 2025 and February 20, 2026 alone, domestic debt rose by Sh197.31 billion.

That is more than Sh3 billion per day.

The government has turned to local markets with increasing urgency.

Access to cheaper external financing has tightened while debt repayments have remained high.

By February 2026, Kenya had already used 87.4% of its full-year domestic borrowing target, with roughly half the financial year still to run.

The instrument mix is shifting too.

Treasury bonds dominate at Sh5.739 trillion, but Treasury bills have edged up from 15.67% of the debt stock in late December 2025 to 16.22% by February 20.

A growing share of short-term debt means the government must refinance more frequently, adding pressure in the months ahead.

Domestic debt does not come cheap.

It carries an average interest rate of about 12%, more than double what concessional external loans cost.

The government spent Sh995.76 billion on interest payments in the 2024/25 financial year, of which Sh767.24 billion went to domestic debt alone.

For 2025/26, the domestic interest bill rises to Sh851.42 billion.

In the first half of the current financial year, 44% of the Sh1.24 trillion collected in government revenue went toward domestic debt service.

For every Sh10 the government received, Sh4.40 was committed to paying local lenders.

The World Bank warned in May 2025 that heavy domestic borrowing risks crowding out the private sector.

Commercial banks, pension funds and insurance companies, the main buyers of government securities, have less left over to lend to businesses when the government is their biggest customer.

Moody's, in its July 2025 credit assessment, flagged that Kenya was spending about a third of government revenue on interest payments.

CBK Governor Kamau Thugge has acknowledged the debt carries a high risk of distress, even as he maintains it remains technically sustainable.