The Kenyan government serviced guaranteed debt of KES17.4 billion shilling (USD135 million) on behalf of Kenya Airways (KQ, Nairobi Jomo Kenyatta) in the third quarter of the 2023/24 financial year ending March 2024, according to the National Treasury.

The payments comprised KES14.3 billion (USD110.8 million) in principal payment and KES3.1 billion (UDS24 million) in interest, as recorded in the May 2024 edition of the National Treasury's third quarter economic and budgetary review.

As of March 31, 2024, its guaranteed debt decreased to KES98.86 billion (USD766.4 million) compared to KES170.23 billion (USD1.3 billion) on June 30, 2023, according to a June 4 report by a parliamentary committee to the National Assembly. It attributed the reduction to the novation process in the financial year 2023/24, where Kenya Airways' guaranteed debt was converted into mainstream external public debt, with a new external commercial loan entered into with US lenders EXIM Bank (United States of America) and US export financier Private Export Funding Corporation (PEFCO). Consequently, the National Treasury has become the primary debtor, shouldering the repayment burden, underlined the Privatisation and Public Debt Committee in its "Supplementary Budget II and 2024–25 Budget Estimates".

The committee recommends that within 30 days of adopting its report, the National Treasury conducts an impact assessment of assuming debt responsibilities for Kenya Airways' guaranteed debt. A report should be submitted to the National Assembly, covering a cost-benefit analysis of the transaction. Additionally, within the same timeframe, Kenya Airways should provide a realistic and comprehensive report on its turnaround strategy and measures to replenish public resources used for guaranteed debt payments and related expenses. It said these reports were crucial for transparency and accountability regarding the airline's financial restructuring.

Removing the debt from Kenya Airways' books is seen as a positive step toward restructuring the airline and attracting strategic investors. In the six months ending June 2023, Kenya Airways recorded a net loss of KES21.7 billion (USD168.2 million) despite achieving its first operating profit of KES998 million (USD7.7 million) in the same period. The airline's restructuring and financial recovery are integral to Kenya's USD4.43 billion programme with the International Monetary Fund (IMF).

Business Daily Africa reports that the USD641.49 million loan was a 12-year facility initially provided by Citibank and JP Morgan Chase Bank in 2017 before PEFCO took it over, with US Exim Bank and the Kenyan government joining as guarantors. The carrier took out the loan to finance the purchase of seven aircraft and an engine but did not fully service the debt due to cash flow challenges linked to COVID-19 pandemic disruptions. The Treasury's guarantee covered USD525 million.