Lofty Corban has launched East Africa’s first private debt-focused special fund, marking a significant shift in Kenya’s investment landscape.
The new fund targets a KSh 2.4 trillion credit gap that has left many viable businesses struggling to access financing.
The Lofty Corban Private Debt Special Fund is structured as a collective investment scheme.
It will primarily invest in commercial paper and carefully selected, growth-oriented credit opportunities.
Target beneficiaries include Saccos, NGOs, churches, trusts, endowments, and foundations.
Speaking at the launch in Nairobi, Lofty Corban, Chief Executive Officer Stanley Mutuku said the fund responds directly to changes in Kenya’s financial system.
“Banks have become more cautious in lending, while returns on government securities have declined. This fund is designed to provide investors with better income, greater stability, and a direct connection to the real economy,” Mutuku said.
Mutuku noted that the firm manages about KSh 5 billion in assets and serves more than 13,000 clients across Kenya, the region, and the diaspora.
He said the new product reflects growing investor demand for predictable returns without excessive risk.
Private debt investments are originated directly with borrowers and held to maturity.
This structure enables investors to earn contractual interest income rather than rely on market price movements.
“The fund pools investor capital to finance carefully selected credit opportunities. These are supported by rigorous credit assessment, diversification, and ongoing risk monitoring, he noted.
The fund is currently delivering returns of about 14% per year, with a target of up to 16% depending on market conditions.
According to Mutuku, this offers a compelling alternative as Treasury Bill yields have fallen sharply from their 2024 highs.
For institutional investors such as pension funds and insurance firms, the fund provides predictable income and better yields than traditional money market instruments.
Retail investors, often excluded from private credit markets, now have access to an asset class previously reserved for large institutions.
“This opens up income-oriented returns in a rising-rate environment,” he added.
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