The government has denied allegations that Ksh.8 billion allocated to the Hustler Fund is missing, clarifying that the funds were never released by the National Treasury.
In a statement on Thursday, Principal Secretary for Micro, Small and Medium Enterprise Development, Susan Mang’eni, explained that the Ksh.8 billion flagged in the Auditor General’s report was set aside as counterpart funding.
These funds were meant to match long-term pension savings for Hustler Fund beneficiaries, a component that was still under development during the 2022/2023 financial year.
Mang’eni clarified that by the close of the audited financial year on June 30, 2023, the savings product had not yet been launched.
“The Ksh.8 billion in question, which had been allocated as counterpart funding to match the long-term savings of the Hustler Fund, was not drawn down from the National Treasury,” she said.
“It would have been imprudent for the Fund to draw down the money only to idle in the commercial banks. We finally finalised the development of the savings product, and we undertook the first matching up during the 1st Anniversary of the Fund on 30th November 2023.”
The Auditor General’s report had raised alarm after revealing that only Ksh.12 billion of the Ksh.22.96 billion allocated to the State Department for Cooperatives had been spent, leaving Ksh.8.2 billion unaccounted for.
Mang’eni emphasized that the money was never spent and that the Fund’s rollout was in line with its planned development schedule.
“We note that the Parliamentary Public Accounts Committee has given us two weeks to provide additional information. We assure the public that we will provide the requested documentation,” she added.
Over Ksh71 BILLION Disbursed
Since its inception in November 2022, the Hustler Fund has disbursed over Ksh.71 billion to more than 26 million Kenyans through personal, group, and bridge loan products.
The Fund has also raised Ksh.4.8 billion in both voluntary and mandatory savings and introduced a behavioural credit rating system ranging from A1 to C3 to assess repayment habits.
Mang’eni noted that more than 4.5 million borrowers currently fall within the A and B rating categories, showing strong credit performance.
The clarification comes as the Public Accounts Committee continues to investigate the issue. On Wednesday, the committee grilled State Department for Cooperatives PS Patrick Kilemi over the Ksh.8 billion shortfall.
Kilemi, who oversaw the Cooperatives docket when the Hustler Fund was launched, admitted that the early phase of the Kenya Kwanza government experienced transitional hurdles. He told the committee that his department had temporarily taken up some responsibilities related to the Fund’s implementation.
