When President William Ruto launched the Hustler Fund barely two months after taking office in 2022, he presented it as a financial revolution meant to free millions of small traders from shylocks and punitive digital lenders.
The President spoke passionately about boda boda riders, market traders, and mama mbogas and small entrepreneurs trapped in cycles of expensive debt and economic vulnerability.
He promised a new economic order built around affordable credit, savings and dignity for ordinary Kenyans struggling at the bottom of the economic pyramid.
“We are establishing a culture of saving, investment and social security,” Dr Ruto said at the launch of the programme in November 2022, describing the fund as the cornerstone of his bottom-up economic model.
Less than four years later, the National Treasury has quietly begun withdrawing taxpayer support from the flagship programme, signalling a policy shift within the Kenya Kwanza administration.
Development budget estimates tabled in Parliament show the government has allocated zero shillings to the Financial Inclusion Fund, popularly known as the Hustler Fund, in the next fiscal year starting July, a situation projected to persist in budget cycles thereafter.
The decision marks a turn for one of the most politically symbolic projects of Dr Ruto’s presidency.
The fund was allocated Sh20 billion in its launch year, but this was scaled down to Sh5 billion during its first full budget year in 2023/24, followed by Sh2 billion in 2024/25 and a sharply reduced Sh300 million allocation in the current financial year ending in June.
The budget allocations are ending before the government fulfils even half of the Sh50 billion President Ruto pledged to inject into the programme when he assumed office.
The shortfall highlights the growing strain between the political ambition behind the programme and the reality of increasingly constrained public finances.
Treasury officials insist the move does not amount to abandonment of the fund, arguing it was always designed to operate as a revolving facility financed by loan repayments rather than endless taxpayer injections.
Albert Mwenda, director-general for Budget, Fiscal and Economic Affairs at the National Treasury, defended the removal of funding on Friday.
“Given the initial capital, the fund is adequately funded at the current uptake of loans. Please note that it was intended to be a revolving fund,” Mr Mwenda said.
His explanation reflects a shift taking shape within government as pressure mounts on the Treasury to contain spending amid rising debt servicing obligations and growing fiscal strain.
At the same time that the Hustler Fund is losing direct budget support, another youth-focused programme is rapidly gaining prominence within Treasury spending plans.
Budget allocations to the World Bank-backed National Youth Opportunities Towards Advancement programme, popularly known as Nyota, have been retained, suggesting the government is pivoting from direct lending towards job creation, skills development and enterprise support.
President William Ruto (standing), Uasin Gishu County Governor Jonathan Bii (second left), MSME Principal Secretary Susan Mang'eni (right), and youths during National Youth Opportunities Towards Advancement (Nyota) activation at Eldoret Sports Club on January 08, 2026.
Photo credit: Jared Nyataya | Nation Media Group
Nyota has been allocated Sh4.78 billion in the current financial year, and will get Sh1.6 billion in the next fiscal year 2026/27 and Sh2.65 billion in each of the following two years.
The contrasting budget paths paint a picture of a government recalibrating its approach to economic empowerment for young people and informal sector workers.
When the Hustler Fund was launched, the programme was designed around simplicity and speed. Borrowers had access to unsecured mobile loans at an annualised interest rate of eight per cent, repayable within 14 days.
The programme initially targeted low-income Kenyans who had historically struggled to secure loans from banks because of lack of collateral, formal employment or credit history.
Former Treasury Cabinet Secretary Njuguna Ndung’u defended the initiative in its early days as an intervention aimed at correcting structural failures within the financial system.
“The Hustler Fund is an instrument to correct market failures at the bottom of the pyramid,” Prof Ndung’u said at the time.
“The Hustler Fund is an instrument to correct market failures at the bottom of the pyramid. Most of the time we start financial products to address needs at the bottom of the pyramid, but what happens is that the product leaves and moves on to the next level, whereas the intention should be that people are the ones to move upwards, not the product.”
The scheme expanded rapidly as millions of Kenyans turned to the mobile platform for quick credit to support household spending and small businesses.
In December 2024, the government introduced a second-tier product known as the Bridge Loan for borrowers with strong repayment records.
The upgraded facility increased borrowing limits by as much as 300 percent and extended repayment periods to 30 days while maintaining the same pricing structure.
By March 2026, the State Department for Micro, Small and Medium Enterprises told Parliament that the fund had disbursed Sh83 billion in loans, of which Sh71 billion had been repaid.
The department was simultaneously seeking Sh300 million from lawmakers to facilitate recovery efforts targeting roughly Sh12.5 billion in defaults.
The figures reveal both the popularity of the programme and the mounting challenges associated with sustaining a large-scale State-backed lending scheme targeting low-income borrowers.
In the financial year ended June 2025 alone, Kenyans borrowed Sh17.9 billion from the fund, highlighting continued demand for accessible short-term credit among millions outside conventional banking.
The fund has also faced growing scrutiny from auditors over governance weaknesses and loan management controls.
Auditor-General Nancy Gathungu.
Photo credit: Wachira Mwangi | Nation Media Group
Auditor-General Nancy Gathungu, in her report for the financial year ending June 2025, disclosed that 104,631 loans worth Sh116.5 million had been issued to customers whose national identity card numbers were missing from the customer database.
“In the circumstances, the issuance of loans to customers without established loan limits points to inadequate credit assessment controls and increases the risk of lending to unqualified or unverified customers,” Ms Gathungu said.
Her audit also questioned the closure of 386,735 loan accounts linked to Safaricom SIM cards before borrowers fully repaid outstanding balances.
“The outstanding principal on these accounts amounted to Sh377,490,360, which should have been recovered before account closure. Management did not provide any evidence to justify or support the closure of these accounts,” Ms Gathungu stated.
The findings added to concerns that the rapid expansion of the programme may have outpaced internal controls and recovery mechanisms.
The government, however, maintains that the programme has achieved significant milestones in expanding financial inclusion.
During his State of the Nation address in November 2025, Dr Ruto described the Hustler Fund as the largest financial inclusion programme since independence.
“The Financial Inclusion Fund, the Hustler Fund, now stands as the largest financial inclusion programme since independence, extending over Sh80 billion to millions of Kenyans,” the President told Parliament.
But even as the President defended the programme, he also hinted at the government’s changing priorities.
