The Kenyan government is preparing to write off Sh6 billion in defaulted loans from the Hustler Fund, even as it seeks an additional Sh5 billion to keep the initiative running. This development was revealed by Principal Secretary Susan Mang’eni during her appearance before the National Assembly’s Committee on Trade, Industry, and Cooperatives on May 21, 2025.
PS Mang’eni reported that 10 million borrowers who accessed credit from the fund in 2022 have failed to repay their loans. Despite the high default rate, she defended the fund’s overall performance, highlighting that 9 million borrowers remain active and are consistently repaying their loans.
Mang’eni urged lawmakers to support the request for additional funding, stating that the extra resources would enable the government to raise loan limits for reliable borrowers and accommodate new applicants. “This fund has played a critical role in supporting micro and small enterprises. With additional resources, we can reach even more Kenyans,” she said.
However, members of the committee raised concerns about the sustainability of the fund, questioning the wisdom of allocating more taxpayer money to a program facing widespread defaults. “We cannot continue injecting billions without a clear recovery strategy,” one MP remarked.
Launched in 2022 as a cornerstone of President William Ruto’s economic agenda, the Hustler Fund aimed to offer affordable credit to small-scale entrepreneurs traditionally excluded from mainstream financial services. Since its inception, the fund has disbursed Sh65.7 billion, with Sh53.2 billion successfully repaid.
The government is now considering introducing legal reforms to enhance loan recovery and reduce future losses. MPs have warned that continued financial hemorrhaging from the fund could worsen the country’s economic situation and called for stricter oversight and better screening of borrowers.
As the debate continues, the government faces a delicate balancing act: promoting financial inclusion while ensuring public funds are managed prudently. With pressure mounting from both Parliament and the public, the future of the Hustler Fund now hinges on accountability, transparency, and measurable impact.
