Wamuzi News Ke
Despite a wave of non-repayment that has rocked the financial inclusion scheme, the Treasury has proposed an additional Ksh300 million injection into the Hustler Fund for the 2025/26 financial year.
This bold proposal comes even as officials scramble to recover funds from millions of Kenyans who took out loans — and vanished without paying a cent.
Treasury Cabinet Secretary John Mbadi made the announcement on Thursday during the national budget presentation, promising renewed financial lifelines for struggling families and MSMEs across the country.
“We acknowledge the ongoing struggle among small businesses and Kenyans at the bottom of the economic pyramid to access affordable credit,” Mbadi declared. “This is why the government is boosting its support for key financial access initiatives.”
But the move comes at a time when the Hustler Fund — launched with hopes of revolutionizing credit for everyday Kenyans — is teetering under the weight of massive defaults.
According to MSMEs Principal Secretary Susan Auma Mang’eni, a staggering 10 million Kenyans took loans from the Hustler Fund between November and December 2022 and never repaid them.
The average loan? Just Ksh500 — but the total loss? A jaw-dropping Ksh6 billion. “We are still chasing defaulters. Some borrowers disappeared completely. If recovery fails, we may be forced to write off the losses — but we’re not there yet,” Mang’eni told Parliament.
Even more worrying: only nine million out of 25.8 million borrowers since the fund’s inception are considered reliable. That’s just one in three Kenyans showing consistent repayment behavior.
Still, the government is betting big.In the same fiscal year, the Treasury has earmarked:Ksh300 million for the Youth Enterprise Development Fund,Ksh600 million for the Centre for Entrepreneurship Project,Ksh1.3 billion for the Rural Kenya Financial Inclusion Facility,and Ksh200 million for agricultural credit targeting MSMEs.
These figures build on last year’s budget, where the government allocated Ksh5 billion to the Hustler Fund and nearly Ksh7 billion in total toward MSME-driven financial programs.Initially, Kenyans could borrow up to Ksh50,000 at an 8% annual interest rate for 14 days.
Though terms have since improved for repeat borrowers, the repayment crisis casts a long shadow over the fund’s sustainability.
As critics question the wisdom of pouring more money into a fund drowning in defaults, the government remains defiant — even optimistic — that its pro-Hustler agenda will pay off in the long run.
And in a surprising twist, the state has also pledged to support livestock farming in rural areas — a move aimed at strengthening the MSME value chain and driving income in underserved regions.
But for now, one thing is clear: Kenya is gambling on the Hustler Fund — again — and the stakes have never been higher.
