The Kenya Human Rights Commission (KHRC) has found itself on the receiving end of a backlash for its report that warned that the Hustler Fund programme is doomed because it lacks a sustainable plan to empower Kenyans at the bottom of the pyramid, as earlier intended. 

Speaking on Wednesday during a presidential private sector roundtable, President William Ruto noted that the Financial Inclusion Fund, known as the Hustler Fund, is a transformative initiative that has empowered millions of Kenyans previously locked out of mainstream financial systems and remains a central pillar of his bottom-up economic agenda.

The President dismissed mounting claims of widespread defaults, terming them falsehoods driven by political agendas.

“I take pride in the success of the Hustler Fund under the Financial Inclusion Fund, a pioneering empowerment initiative. In just under three years, it has disbursed over KES72 billion to 26 million Kenyans, mobilised over KES5 billion in savings and provided vital working capital to millions of micro-entrepreneurs, proving that even the smallest businesses can thrive with the right support,” said the President.

He maintained that the fund has significantly benefited small businesses through micro-loans

“These small people who borrow KES1,000, KES2,000, KES5,000 and KES10,000– they have mobilised 5 billion shillings in savings over the last three years… They did not have a mechanism for where to save without going into a place where their money could be lost. Now they have a mechanism under Hustler Fund that has the backing of the government of Kenya,” Ruto said.

According to ruto, those questioning the fund’s impact have misrepresented facts and failed to understand the economic challenges faced by ordinary Kenyans.

“Our critics, the naysayers, the perpetual pessimists and the chorus that never sees anything working in Kenya, would have you believe that the Hustler Fund is a failure, as it is indicated in today’s newspapers. They say this because they either do not understand or refuse to acknowledge the daily realities of millions of Kenyans. This fund was designed to empower,” he said.

He argued that the alleged 60 percent default rate is inaccurate and urged members of the public not to fall for the hearsay.

“Now those same critics are spreading fear and responsibility by falsely claiming that the fund has a 60 percent default rate. That is a deliberate distortion of facts. The truth backed by data is that the Hustler Fund has a recovery rate of 83.3 per cent, nearly identical to that of the formal banking sector, whose repayment rate stands at 83.6 percent,” said the president.

Co-operatives and Micro, Small and Medium Enterprises (MSMEs) Development Cabinet Secretary Wycliffe Oparanya also defended the Hustler Fund against criticism.  According to him, professionalism demands a response from key players. The conclusions made are keen to sentence the Fund to death without trial.

Oparanya accused the KHRC of using flawed data and biased methodology to discredit the Fund, which he said has made significant strides in expanding financial inclusion since its launch in late 2022.

“The title of the report explicitly betrays the whole purpose of the study,” Oparanya said in a statement, questioning why the ministry or the Fund’s management had not been consulted during the research process.

The CS further challenged several claims made in the report, including the Fund's accessibility, loan limits, sustainability and an assertion that the Fund was capitalised with KES 50 billion.

“The amount so far injected is KES14 billion, which has been reinvested in a portfolio of over KES72 billion,” he said.

He also dismissed allegations that the Fund is difficult to access, saying over 9 million people borrow regularly from the Hustler Fund, and over 5 million borrowers have demonstrated strong repayment behaviour, making them eligible for larger amounts under the “Bridge” loan product.

In the report titled, “Failing the Hustlers,” the KHRC described Hustler Fund as a politically expedient but economically disastrous initiative that has failed to deliver on its promises of financial empowerment for low-income Kenyans. It concludes that the fund is structurally unsound, economically unsustainable, and politically manipulated, and recommends that the government scrap it entirely.

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