Uncertainty over land ownership and persistent corruption in land administration are increasing the cost of property transactions and making it harder for Kenyan businesses to use land as collateral, the World Bank has warned.
In its November 2026 Kenya Economic Update, the lender says questions over whether land titles are genuine or fraudulent are creating additional risks for banks, borrowers and investors. Financial institutions cannot always rely on current land registers when accepting property as security for loans.
Instead, lenders and borrowers may have to trace the ownership history of a parcel to establish whether every previous transaction was legitimate. This includes checking whether publicly owned land was properly degazetted before being transferred, as well as whether earlier sales could be challenged by spousal claims.
The additional checks make property transactions more expensive and time-consuming, particularly where land registration systems are inefficient.
The World Bank says land administration offices remain vulnerable to corruption demands. The Ministry of Lands and Housing and the National Lands Commission continue to feature among institutions perceived by respondents to Kenya’s Ethics and Anti-Corruption Commission surveys as prone to frontline corruption.
Transparency International’s land services bribery index also rose to 45.0 in 2025, from 41.7 in 2017 and 32.2 in 2019, pointing to a deterioration in the indicator over the period.
The report highlights land fraud as a problem affecting both agricultural and urban property, with schemes often involving collusion between private individuals and public officials.
One example cited is a Nairobi land fraud scheme involving property valued at more than KSh1 billion, which triggered a court case in 2025. The case involved a former Nairobi Deputy Provincial Commissioner, Ministry of Lands officials and private entities.
Delays and opacity in public land allocation procedures also create backlogs and raise costs for citizens and investors. The report says bureaucratic inefficiencies can appear deliberate, making it harder to establish clear and predictable processes for accessing land-related services.
Efforts to digitise land administration have not fully resolved the challenges. Digital Land Information Management Systems have been piloted in Nairobi and a few other counties since 2021, but remain incomplete.
The World Bank notes that requests submitted through the system, including title searches, do not consistently receive responses within stipulated timelines. Applicants may still need to identify and contact individual staff members and pay informal fees to obtain services.
The consequences extend beyond property buyers. When lenders cannot confidently establish ownership, they face greater risks when accepting land as security. Borrowers may consequently encounter longer approval processes, higher transaction costs and difficulties accessing finance.
The report also points to construction permits issued for land marked as riverbanks, exposing buildings to flood risks and possible mandatory demolition.
The World Bank says comprehensive land management reforms have been constrained by entrenched political and economic interests. Completing digital land systems and improving the reliability of registration records will be important steps towards reducing fraud, strengthening property rights and improving access to finance.
