The government is set to track down defaulters of the Hustler Fund in an effort to recover disbursed loans and reopen access for borrowers with strong credit records.
A report by the National Treasury reveals that 94 per cent of the 22 million borrowers have defaulted, leading to a 93.3 per cent drop in disbursements in 2024, which fell to Sh800 million.
Co-operatives and Micro, Small and Medium Enterprises (MSMEs) Cabinet Secretary Wycliff Oparanya said the high rate of default has limited access to short-term loans, negatively impacting small businesses.
“For those 19 million people, I am coming for you to make sure that you pay so that other borrowers can benefit too,” Oparanya stated.
The Hustler Fund initially recorded high uptake, with disbursements reaching Sh39.7 billion to 21.8 million borrowers and Sh2 billion in savings mobilised by November 30, 2023. At that time, total repayments stood at Sh28.75 billion.
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In December 2023, President William Ruto stated that the fund had disbursed Sh60 billion since its 2022 launch.
Buoyed by numbers, Ruto announced an increase in borrowing limits during the fund’s first-anniversary celebrations.
“For those who have demonstrated a commitment to saving, and your savings exceed your loan limit, we will double your credit limit,” Ruto said.
Earlier in August 2023, Ruto had urged defaulters to repay their debts to access the newly introduced Hustler Group Loan.
“We know that there is a percentage of Kenyans who are yet to repay their debts, but I can tell you, you will not run far. We have put money in the business loan account but you will not get the loan until you have cleared the arrears,” he warned.
An additional Sh10 billion has been set aside for group business loans, offering between Sh20,000 and Sh1 million, but access is conditional upon clearing existing loans.
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