A bond is a loan between a borrower and a lender. The borrower promises to pay the lender some interest quarterly or semi-annually at some date in the future and the initial money invested by the lender. In Kenya, it is the government and companies that borrow money through bonds. The prices for bonds fluctuate at values above or below their face value, reflecting buying and selling strengths, but are closely linked to the prevailing market interest rates so as to remain attractive to potential investors.

At the NSE, two types of bonds are listed and include Government Bonds (Treasury bonds and Treasury Bills) and Corporate Bonds issued by companies.