If you want to save for at least a year, the KCB M-Pesa Fixed Savings Account is for you. This mobile-based savings account offered by KCB Bank Kenya Ltd. and Safaricom’s M-Pesa has competitive interest rates and a safe way to grow your savings over a fixed period.

In 2025 it’s one of the best savings options in Kenya with guaranteed returns that are hard to beat.

How KCB M-Pesa Fixed Savings Account Works

KCB M-Pesa Fixed Savings Account allows you to lock away a lump sum for a fixed period of 1 to 12 months. It’s a good option if you want a safe place to put money away for a specific goal—whether it’s saving for school fees, a wedding or a big purchase.

Here’s how it works:

  • Start Saving: You can start with as low as KES 500.

  • Guaranteed Interest: You’ll earn a fixed annual interest rate of 8.5% on your deposit which will be paid at the end of the agreed term.

  • No Additions or Withdrawals: The account does not allow you to add more or withdraw during the term. However, you can make an early withdrawal but be warned you will lose all the interest you’ve earned so far.

The account’s main advantage is that it’s a long-term savings tool with guaranteed returns so if you have a specific goal in mind and can commit not to touch the money for a year (or more) this is a good option.

KCB M-Pesa Fixed Savings vs Target Savings Account

If you want a bit more flexibility you may want to consider the KCB M-Pesa Target Savings Account which also has competitive interest rates starting from KES 500. The main difference is that with the Target Savings Account you can make ongoing contributions as low as KES 50. Interest rates for this account start from 8%.

Here’s a comparison of the two accounts:

  • Target Savings Account* Flexible deposits: Add any amount at any time.

  • Early withdrawals: You can withdraw without forfeiting interest, but it may take 1-2 days to access your funds.

  • Loan eligibility: Both accounts help you qualify for loans with amounts starting from KES 50 to KES 1 million based on your savings history and M-Pesa activity.

  • Fixed Savings Account:

    • Fixed term: Once you lock in your money you can’t add or withdraw until the end of the term.

    • Higher interest rate: 8.5% guaranteed, paid at the end of the term.

    • Instant withdrawal option: If you need to access your funds before the term ends the process is quick—but you’ll lose your interest.

How to Open a KCB M-Pesa Savings Account

Opening either account is easy and free. Just meet the following requirements:

  • Be an active M-Pesa user for at least 6 months.

  • Access via SIM Toolkit: Go to “Loans and Savings” > “KCB M-Pesa,” and follow the prompts to set up your account.

Once activated you can start saving with the KES 500 minimum deposit.

Challenges and Considerations

While KCB M-Pesa savings accounts are great, there are a few things to note:

  • Early Withdrawal Penalty: If you withdraw from Fixed Savings Account early you lose all the interest you have accumulated.

  • Documentation Requirement: If your savings exceed KES 250,000 you will need to provide extra documentation at a KCB branch. This can be a hassle if you are in rural areas with few banking facilities.

  • Loan Interest Rates: If you plan to borrow interest rates can be high—7% to 9% per month depending on the repayment term. Plan your finances well to avoid over borrowing.

Why KCB M-Pesa Fixed Savings Account?

Despite the challenges the KCB M-Pesa Fixed Savings Account stands out in many ways:

  • Guaranteed returns: You know exactly how much you will earn by the end of the term, perfect for long term savings goals.

  • No fees to open: It's free to open so it’s accessible to many users.

  • Discipline: The no withdrawals feature helps you stay focused on your financial goals without the temptation to withdraw from your savings.

Why Can’t I Get a KCB M-Pesa Loan?

If you can’t get a KCB M-Pesa loan it could be because:

  • You have an unfavorable credit history.

  • You already have an existing KCB M-Pesa loan.

  • Late repayment of a previous loan has resulted in your blacklisting.

Key Takeaways

KCB M-Pesa Fixed Savings Account 8.5% interest on deposits for a fixed period, no withdrawals during that time.

  • Target Savings Account more flexibility, ongoing deposits and withdrawals but lower interest rates.

  • Both are a good way to save and qualify for loans based on your savings.