Susan Maina is a Corporate Compliance Writer and Legal Researcher at M&A Registrars, a leading company secretarial and legal advisory firm. She specializes in developing clear, insightful content on Company Law, Corporate Governance, Regulatory Compliance, and Business Registration Services.
LinkedIn >>Thinking of starting a business and unsure which type of company in Kenya suits you best.
Whether you’re a small business owner, NGO director, or first-time entrepreneur, the process might sound complicated.
You’ve probably heard terms like limited by shares, memorandum of association, or compliance with the Companies Act, 2015 – and wondered if you need a law degree to figure it out.
The good news? You don’t.
This guide by M&A Registrars explains types of companies in Kenya in plain, everyday language, with practical examples, tables, and FAQs.
Table of Contents
1. What is a Company in Kenya?
2. Can a Company Be Owned by One Person?
3. Types of Companies in Kenya
4. What’s the Difference Between a Business Name and a Company?
5. How Much Does It Cost to Register a Company in Kenya?
6. How Long Does Company Registration Take in Kenya?
7. What Do You Need to Start a Company in Kenya?
8. Which is the Best Type of Company in Kenya To Start?
9. Why Register a Company in Kenya?
10. Frequently Asked Questions on Company Registration in Kenya
11. Final Word
12. Disclaimer
A Company in Kenya is a legal entity – almost like a “person” in the eyes of the law. It can:
This is very different from a business name (sole proprietorship). With a business name, you and the business are one and the same. If the business gets into debt, you personally carry that burden.
Example:
That’s why company registration is such a powerful step – it separates you from the business.
This section explains why company registration in Kenya creates a legal separation between you and your business.
Choosing the wrong company type can slow you down – let our experts guide you to the perfect structure for your SME, NGO, or startup.
Book Your Free First Consultation TodayYes. The Companies Act, 2015 allows for a single-member company. This means one person can be both the sole shareholder and the sole director.
So if you’ve been delaying registration because you thought you needed partners, you don’t. You can start on your own and bring in other shareholders later if needed.
When going through company registration in Kenya, you first need to understand the different types of companies in Kenya, because each structure matches different goals.
The Companies Act, 2015 recognises several categories, each designed for a different purpose.
Here’s a deeper look at the main types:
1. Company Limited by Shares
This is the most common type of company in Kenya. It’s what most SMEs, startups, and family-owned businesses choose.
| How it Works: | The company has a share capital (for example, 1,000 shares at KES 100 each). Shareholders own these shares, and their liability is limited to the amount they’ve invested. |
|---|---|
|
Good for |
Entrepreneurs who want to protect their personal assets and build a business that can grow.
|
|
Example |
If you own 100 shares worth KES 10,000 in Green Energy Solutions Ltd, the most you can lose (if the company collapses) is KES 10,000.
|
2. Company Limited by Guarantee
This type is ideal for NGOs, charities, and non-profit organisations.
| How it Works: |
- Instead of shareholders, it has members who act as guarantors. - They don’t invest money upfront but agree to contribute a small, pre-set amount (say KES 1,000) if the company winds up. |
|---|---|
|
Good for |
Organisations focused on social impact, education, charity, or community projects – not making profits.
|
|
Example |
An NGO running community water projects registers as Water for All Kenya (Ltd by Guarantee). Members guarantee KES 1,000 each but do not own shares.
|
3. Unlimited Companies
These are rare in practice, but still recognised in law.
| How it Works: | Members (owners) have unlimited liability. If the company cannot pay its debts, the owners’ personal assets can be used to cover them. |
|---|---|
|
Good for |
Specialist cases, often where owners want maximum flexibility in managing capital without statutory restrictions.
|
|
Example |
A group of investors could set up an unlimited company if they’re comfortable taking full personal responsibility for risks.
|
4. Private Companies
Most Kenyan companies are registered as private companies.
| Key Features: |
- Limited to a maximum of 50 shareholders. - Cannot invite the public to buy shares. - Often family-run, startup, or SME businesses. |
|---|---|
|
Good for |
Businesses that want formal structure but don’t need to raise funds from the public.
|
|
Example |
Sunrise Furniture Ltd is owned by a couple and their two children. It has 4 shareholders, operates as a private company, and cannot sell shares to the public.
|
5. Public Companies (PLC)
A public company is designed for bigger businesses that want to raise funds by offering shares to the public.
| Key Features: |
- Can list shares on the Nairobi Securities Exchange (NSE). - Must have at least 2 directors and 7 shareholders at registration. - More strict reporting and compliance requirements under the Companies Act. |
|---|---|
|
Good for |
Large businesses looking to expand, attract investors, or go public. |
|
Example |
Safaricom PLC is listed on the NSE, with thousands of shareholders from the public. |
Comparison of Different Types of Companies in Kenya (2025)
| Type of Company | Who it Suits | Key Feature | Example |
|---|---|---|---|
|
Limited by shares |
SMEs, startups |
Owners’ liability limited to their shares. Most common type.
|
Green Energy Solutions Ltd
|
|
Limited by guarantee |
NGOs, non-profits, charities
|
No share capital; members act as guarantors.
|
Water for All Kenya
|
|
Unlimited Company |
Rare/specialist businesses
|
Owners have unlimited liability for debts.
|
Investor-only setups |
|
Private Company |
SMEs, family businesses
|
Up to 50 members; cannot sell shares to the public.
|
Sunrise Furniture LTD |
|
Public Company (PLC) |
Large Corporates |
Can invite the public to buy shares; can list on NSE.
|
Safaricom PLC
|
Tip:
If you’re just starting, the safest and most flexible choice is usually a private company limited by shares. NGOs should look at companies limited by guarantee, while large corporates aiming to list on NSE should go for a public company.
We’ll help you choose a structure that protects your personal assets and sets your business up for growth.
Get Expert Guidance for Your Company NowThis is one of the most common questions we hear.
Many entrepreneurs start with a business name, but eventually upgrade to a company for growth and protection.
| Feature | Business Name (Sole Proprietorship) | Company (Ltd/PLC) |
|---|---|---|
|
Legal Status |
You and the business are the same.
|
Separate legal entity.
|
|
Liability |
You’re personally liable for debts.
|
Limited liability – the company shoulders the risk.
|
|
Setup Cost |
Cheaper
|
Slightly higher.
|
|
Perception |
Seen as small or informal.
|
More credibility with clients, banks, and investors.
|
|
Continuity |
Ends if the owner stops.
|
Can outlive the founders.
|
Example: If Alex runs Alex Designs as a sole proprietorship, his personal assets are at risk if the business fails. If he registers Alex Designs Limited, the liability is capped at the company level.
Rule of thumb:
The cost of company registration in Kenya depends on the type of company and whether you use professional help.
Here’s a general guide:
| Cost Item | Amount (KES) |
|---|---|
|
Name reservation
|
150 |
|
Stamp duty (if applicable)
|
Varies
|
|
Registration/incorporation fees
|
From Ksh. 10, 000
|
|
Professional/secretarial fees
|
Varies (M&A Registrars offers affordable, transparent options)
|
On average, SMEs in Kenya spend KES 12,000 – 20,000 for complete registration.
Tip:
For the most up-to-date breakdown (especially for NGOs, PLCs, and guarantee companies), check out our detailed article on company registration fees in Kenya.
On average, company registration in Kenya via eCitizen takes 5–10 working days
Common causes of delays include:
With the right guidance, most SMEs and NGOs can complete registration without stress.
Before you jump into registration, it helps to have your documents and details ready. Missing even one requirement can cause delays on eCitizen.
Here’s what you need for company registration in Kenya:
| Requirement | What It Means | Documents/Details Needed | Pro Tips |
|---|---|---|---|
|
Proposed Company Names |
– You must submit at least 3 name options in order of preference. – Names must be unique and not infringe trademarks. |
3 preferred names
|
Avoid generic names like “Best Enterprises Ltd.” they’re often rejected. Check availability on eCitizen first.
|
|
Directors & Shareholders |
At least 1 director/shareholder is required (single-member companies allowed).
|
– National ID/Passport – KRA PIN Certificate (for Kenyan residents) – Passport photo (digital, clear background). |
– For foreign investors, provide passport + photo. – Work permit details may be needed in some cases. |
|
Registered Office Address |
Every company must have a registered address for official correspondence.
|
– Physical address (plot/house number, street, town, county) – Postal address (P.O. Box) – Email & phone number. |
No office yet? Use a virtual office address or service provider’s registered address. |
|
Company Objectives |
A brief statement of what the company will do.
|
– General commercial objective (for SMEs/startups). – Specific objectives (for NGOs, e.g. “education” or “healthcare”). |
Most SMEs use a broad commercial objective. NGOs/non-profits need clear, specific objectives. |
|
Memorandum & Articles of Association (M&A)
|
Your company’s rulebook that sets out structure and governance.
|
– Memorandum of Association (name, members, shareholding, liability). – Articles of Association (rules on governance, meetings, shares). |
– SMEs usually adopt the standard articles under the Companies Act. – NGOs or unique businesses may need customized ones. |
|
Optional Documents |
Extra documents depending on company type/sector.
|
– Work permits (for foreign directors/shareholders). – Special licenses (banking, insurance, healthcare, etc.) – Company secretary details (mandatory for public companies or private companies with capital above KES 5M |
|
The “best” company structure depends on your business goals, funding plans, and long-term vision. Here’s a simple guide to help you choose:
| Goal/ Situation | Best Company Type | Why It Works | Things to Keep in Mind |
|---|---|---|---|
|
SME or Startup |
Private Company Limited by Shares
|
– Flexible ownership. – Limited liability (protects personal assets). – Easy to bring in partners or investors later. |
– Can have 1–50 members. – Cannot sell shares to the public. – Most affordable and beginner-friendly. |
|
NGO or Non-Profit |
Company Limited by Guarantee |
– No share capital required. – Members act as guarantors, not shareholders. – Widely accepted for NGOs, donor-funded projects, and charities. |
– Funds must be used for the organisation’s objectives (not profit distribution). – Usually requires clear, specific objectives. |
|
Public Limited Company (PLC) |
Expansion / Raising Public Funds
|
– Can invite the public to buy shares. – Eligible for listing on the Nairobi Securities Exchange (NSE). – Boosts credibility with investors. |
– Heavier compliance requirements (audits, disclosures). – Must have at least 2 directors and a qualified company secretary. |
If you’re unsure:
We usually recommend starting with a Private Company Limited by Shares. It’s cost-effective, simple to run, and gives you the flexibility to scale as your business grows.
Don’t risk compliance issues – our team guides you step-by-step through registration so you can start with confidence.
Book Your Free First ConsultationStill asking yourself whether it’s worth going through the registration process? Here are the key benefits of setting up a registered company in Kenya compared to running a simple business name:
| Benefit | What It Means | Example |
|---|---|---|
|
Limited Liability Protection |
Your personal assets (car, land, savings) are separate from the company’s debts.
|
If Bright Logistics Ltd owes KES 1M, the company is responsible – not the owner personally.
|
|
Credibility & Trust |
Banks, investors, and donors are more willing to work with a company than with an unregistered sole proprietorship.
|
Jane’s Bakery Ltd is more likely to get a bank loan than Jane’s Bakery (Business Name).
|
|
Flexibility for Growth |
You can easily add shareholders, bring in investors, or transfer ownership shares.
|
A startup can add new partners without shutting down or re-registering. |
|
Business Continuity |
The company exists as its own “person” in law – it can continue even after the founders exit or pass away.
|
GreenTech Solutions Ltd can outlive its original owner and continue trading under new management.
|
|
Professional Image |
A registered company is seen as more serious and formal by clients, suppliers, and regulators.
|
NGOs and corporates prefer contracting companies, not sole proprietors.
|
|
Access to Opportunities |
Some tenders, grants, and donor projects require applicants to be registered companies.
|
An NGO can only access certain donor funding if it is a company limited by guarantee
|
1. How much does it cost to register a company in Kenya?
Official government fees start from KES 10,000. You may also incur professional or secretarial support fees, depending on whether you use an agent. For a breakdown of costs across different company types, see our [2025 Company Registration Fees Guide].
2. How long does company registration take in Kenya?
On average, 5–10 working days if all documents are correctly submitted on eCitizen. Delays usually happen when there are KRA PIN issues, missing documents, or rejected names.
3. Can foreigners register a company in Kenya?
Yes . Foreigners can register companies in Kenya. The requirements include a passport copy, passport photo, and sometimes work permit details (if you’ll be working locally as a director).
4. What’s the difference between a business and a company?
A business name (sole proprietorship) means you are the business – if it takes on debts, you personally owe them. A company, on the other hand, is a separate legal entity with limited liability, so the debts belong to the company, not you.
5. Which is the easiest company type to start in Kenya?
For most SMEs and first-time entrepreneurs, a Private Company Limited by Shares is the best starting point. It’s cost-effective, flexible, and protects your personal assets
The company registration process in Kenya doesn’t have to be complicated.
With the right support, you can move from idea → registered company → open for business in just a few days.
At M&A Registrars, we’ve supported hundreds of SMEs, NGOs, and corporates through the company registration process – helping them avoid delays, cut through the jargon, and stay fully compliant with the Kenya Companies Act, 2015.
Whether you’re starting small or planning something big, we’ll walk with you every step of the way.
Choosing the right structure from the main types of companies in Kenya is the first step to registering successfully.
Talk to us today and start your company registration journey with confidence.
Avoid delays, protect your assets, and get fully compliant – talk to M&A Registrars now and launch with confidence.
Book Your Free First Consultation - Start TodayThis guide is for general informational purposes only. While it highlights the key steps and requirements for company registration in Kenya (based on the Companies Act, 2015), it does not constitute legal or professional advice.
For tailored advice that matches your specific situation – especially if you’re setting up an NGO, foreign-owned company, or regulated business – we recommend seeking professional support.
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