A new report by a watchdog has issued a damning verdict on the Hustler Fund, labelling it a structurally flawed, economically unsound, and politically motivated initiative that has failed to empower the citizens it was meant to uplift.
The report by the Kenya Human Rights Commission (KHRC), which recommended that the fund be decommissioned, established that the fund has failed to deliver on its mission.
“The evidence presented in this study leads to a singular and inescapable conclusion that the Hustler Fund has failed and should be scrapped. Despite political rhetoric and publicised success stories, the fund has neither pushed for financial inclusion nor provided meaningful economic empowerment to its target demographic,” it reads.
Status of Disbursement of Hustler Fund as of December 19, 2022.
Opted-in customers 16,591,441 Total amount disbursed (Sh) 9,583,139,492 Savings account (Sh) 479,032,238
Source: Press release on Hustler Fund, November 2022
However, in a quick rejoinder, the government strongly defended its flagship project, terming the report “malice” and saying they were never given a chance to give clarity on the issues raised.
Launched with much fanfare on November 30, 2022, as a flagship policy of the Kenya Kwanza administration, the fund aimed to democratise access to credit for low-income Kenyans under the Bottom-Up Economic Transformation Agenda.
But almost two years later, the report, titled Failing the Hustlers, concludes that the fund has instead turned into what it calls an “economic sinkhole” and urges that it be scrapped altogether.
Cooperatives and Micro, Small and Medium Enterprises Development Cabinet Secretary Wycliffe Oparanya in Nairobi on July 12, 2025.
Photo credit: Wilfred Nyangaresi | Nation Media Group
“Evidence has further shown that there has been a significant misallocation of public funds via the Hustler Fund, with a default rate of 68.3 per cent, a net loss of 71.5 per cent, and an opaque governance structure flagged by the Auditor General,” the report says.
Hustler Fund’s loan products, the report established, “are poorly tailored, the repayment periods are unrealistic, the delivery channels are exclusionary, and the savings component is widely misunderstood and misused”.
But Cooperatives and MSMEs Cabinet Secretary Wycliffe Oparanya challenged KHRC to present evidence if they ever reached out. “If they truly were honest, they would have approached us,” he said.
The CS, however, admitted that “the fund was created in a hurry” and experienced teething issues.
Status of Disbursement of Hustler Fund as of September 2024.
Personal loan product Group micro-enterprise loan product Opted-in customers 23,293,402 Number of registered and completed groups 53,724 Total number of members registered and completed groups 1,259,092 Amount disbursed (Sh) 52,945,855,160 Amount disbursed (Sh) 179,295,038 Savings account (Sh) 2,282,214,950 Savings account (Sh) 8,964,752
Source: https://www.hustlerfund.go.ke
According to the study, the fund’s economic model has become unsustainable, with the report estimating that for every Sh500 loan issued, about Sh340 is never recovered. Factoring in the average Treasury Bill rate of 8.2 per cent and a 3.0 per cent operational cost, the fund's total cost to the taxpayer stands at a shocking 71.5 per cent, the report says.
One of the criticised aspects is its loan design. Most individual loans range from Sh500 to Sh1,000, which the researchers say is far too little to start or scale a business. Borrowers must repay within 14 days. But the short repayment period, the report observed, has only exacerbated defaults and forced users into repeat borrowing cycles.
President William Ruto (right) and Prime Cabinet Secretary Musalia Mudavadi (centre) during the launch of the Hustler Fund at Green Park Terminus in Nairobi on November 30, 2022.
Photo credit: PCS
Furthermore, the report took issue with the fund’s lack of transparency. The Office of the Auditor General was unable to audit the fund because of missing documentation and unsupported transactions. The report underscores how the fund was birthed from a political campaign narrative that painted President William Ruto as a champion of the “hustler” class, which is contextually viewed as Kenya’s informal workers and small-scale entrepreneurs. But this populist framing, the KHRC argues, has contributed to a widespread belief that the money is a political reward, not a loan, thereby eroding repayment discipline.
The KHRC says the fund’s priority appears to have been breadth over depth, focusing on reaching as many borrowers as possible without ensuring the loans were useful or productive.
The government boasts of the fund having the lowest interest rates of eight percent, with CS Oparanya touting it “as one of the best in the market” and first of its nature in the East Africa region.
The KHRC report places the Hustler Fund’s default rate at 68.3 percent, meaning that for every 10 borrowers, roughly seven have failed to repay their loans. But CS Oparanya said that “the default rate currently stands at 20 per cent”, explaining that initially, it was as high.
Repayment Rate
Default Rate
Source: Cytonn Investment and the Ministry of Cooperative and MSME, 2022
Given its poor design, high political interference, and lack of accountability, the KHRC report recommends scrapping the Hustler Fund. Reform, it argues, is not enough.
“Parliament and the Executive must decommission the Hustler Fund. The remaining resources should be reallocated to existing, better-structured financial inclusion initiatives with proven performance… and integrating lessons from the Hustler Fund’s failure would provide value for taxpayers. Even with this reallocation, safeguards must be implemented to prevent political capture, duplication of roles, and misuse of funds.”
The KHRC report also warned that unless Kenya learns from the failure of the Hustler Fund, the country risks institutionalising a culture of wasteful public spending masked as “empowerment.”
“Over the past two decades, Kenya has invested heavily in Financial Inclusion Funds, often packaged as state-led empowerment programs to uplift marginalized communities. However, these schemes have frequently failed to deliver fundamental, lasting transformation. Instead, they have tended to serve political interests, offering short-term visibility rather than sustainable impact,” said the report.
