An audit of Kenya’s Hustler Fund has uncovered Sh31.8 million disbursed to borrowers who were either underage or not yet born, raising serious concerns about mismanagement and potential fraud.
Auditor-General Nancy Gathungu’s review of the 2023/24 financial year highlights systemic flaws, including over-reliance on external managers and soaring loan defaults.
The findings cast doubt on the credibility of President William Ruto’s flagship financial inclusion initiative.
The audit reveals that 44,167 ineligible borrowers accessed funds, including 42,981 accounts registered with future birthdates receiving Sh31.1 million, and 1,377 minors—some as young as 10 days old—accessing loans.
Additionally, 253,717 accounts had birthdates set after disbursement, suggesting widespread record manipulation.
Safaricom led in registering these accounts, followed by Airtel and Telkom, while weak oversight from outsourced payment providers contributed to Sh11 billion in defaults from the Sh57 billion lent by September 2024.
The findings raise urgent concerns over data integrity and accountability in the Hustler Fund.
Calls for stricter controls, improved oversight, and a crackdown on fraudulent registrations are expected as the government faces pressure to restore confidence in the program.
Launched in November 2022, the Hustler Fund targets Kenyans who could not access credit, having been blacklisted by various credit rating agencies.
It has been offering loans from Ksh.500 to as high as Ksh.50,000 at an eight per cent pro-rated basis or a daily rate of 0.002 per cent and recently introduced enhanced credit limits and a credit score which borrowers can use when seeking loans from banks and other lending institutions.
This revelation, comes just a day after Cooperatives and MSMEs Cabinet Secretary Wycliffe Oparanya revealed he needs an additional allocation of Ksh.8.4 billion to the Financial Inclusion Fund.
The minister, during a Monday meeting with the National Assembly Departmental Committee on Trade, Industry and Cooperatives, said the credit program is among the government’s key initiatives he deems underfunded in the 2025/26 financial year budget.
The MSMEs State Department, according to the Cs, requires Ksh. 25,997,000,000 in the new fiscal year beginning June but has only been allocated Ksh.6,353,300,000—of which Ksh.1,724,300,000 is recurrent and Ksh.4,629,000,000 is development allocation.
At the same time, his ministry also seeks additional funding for the women, youth and disabled persons-focused Uwezo Fund and the Micro and Small Enterprises Authority.
The Cooperatives Cs, told legislators that some Ksh.62 billion was lent to MSMEs through the Hustler Fund in the 2024/25 financial year.
