The Sh6billion Hustler Fund mystery: Fraud or massive defaults?

Suspected internal fraud has rocked the Financial Inclusion Fund (HustlerFund) raising concerns over the integrity of Kenya’s flagship credit initiative for low-income borrowers, The Informer Media Group can authoritatively reveal.

Impeccable insider sources who spoke on condition of anonymity intimated that the programme is dogged with massive irregular loan allocations, inflated beneficiary numbers, and possible manipulation of digital lending systems occasioning the high default rate and “untraceable beneficiaries.” Our source disclosed.

“There are apparent discrepancies between actual registered users and the disbursed loan volumes. Some loans appear to have been issued to unverifiable or duplicate mobile accounts, while others were linked to numbers that did not meet registration thresholds,” Our source added.

Fears are also rife that there is possible collusion between external fraud networks and individuals with access to the platform’s backend systems.

The revelations comes days after Members of Parliament (MPS) expressed serious concerns over a potential loss of over Sh6billion that borrowers have not repaid.

During a meeting on Tuesday, November 18, 2025 lawmakers from the National Assembly’s Special Funds Accounts Committee chaired by Fatuma Zainab questioned the fund’s Chief Executive Officer, Harry Henry Tanui, demanding answers about the whereabouts of the money.

The committee was forced to suspended a scheduled session with the Financial Inclusion Fund (Hustler Fund) after it emerged that the Fund’s management had failed to respond to 21 audit queries for the 2022/2023 financial year for over a year.

The Committee expressed concern that despite being given ample time, the Fund had not furnished documents required for the auditors’ review, which the Committee requires for its ongoing scrutiny of how public money was used.

“What we have witnessed today is a mockery of this committee,” the chairperson said, directing the newly Tanui, to return with all outstanding documents within seven days.

“We will not accept excuses. Kenyans deserve clarity,” she added.

Members of the committee questioned why critical records, including the list of beneficiaries and the status of funds not yet in circulation, had not been presented.

Legislators noted that the failure to disclose such information raises doubts about whether the funds were managed transparently.

Tanui on his part, while insisting that “no money has been lost,” confirmed that the Fund had received Sh14billion from the exchequer, with only Sh1.4billion currently in circulation.

However, MPs countered that unrecovered loans still amount to lost money in the eyes of taxpayers.

Responding to a question from committee member Charles Nguna on the status of beneficiaries, the CEO said that a recovery strategy is underway, adding that the loans are tied to ID numbers and the Fund will provide the relevant records. The Committee, however, questioned why these details had not been provided.

The Vice-Chairperson, Rahim Dawood raised further concerns, stating that some of the money may have been disbursed to fictitious accounts, noting that the Committee has sought these documents for almost a year.

“The PS is hiding behind your office,” he added.

Irate committee members also signaled the possibility of recommending a special audit, citing unanswered questions on whether the remaining funds are still intact in the Fund’s accounts and why the supporting documents have been repeatedly withheld.

“This is the last chance. We must account to the people. We need proper details of who got what money and what has happened since,” the chaired directed.

The MPs have called for a comprehensive investigation into the funds to determine whether the money is safe or has been lost, although the CEO has dismissed claims of any financial loss.

During the session, committee members raised questions about the accountability and management of the Hustler Fund, with some expressing uncertainty about the actual status of the borrowed funds.

“So up to now, we don’t know whether money is lost. We don’t know whether money has been stolen, but we just know we need to order to know is the money there, is it safe? So these documents will help us make a ruling whether Hustler Fund is competent or incompetent in its functions,” one MP stated.

Another legislator highlighted the stark disparity between the funds disbursed and the amounts recovered, raising further alarm about the fund’s sustainability.

“The CEO has confirmed they have already received 14 billion from Treasury, from Exchequer, and only 1.4 is refunded. You can mathematically say over Sh12billion is already…” the MP noted.

The parliamentary inquiry comes just days after President William Ruto publicly addressed the issue of Hustler Fund loan defaulters.

On Friday, November 7, 2025 the president targeted Kenyans who had borrowed money from the fund and failed to fulfill their repayment obligations, although he made it clear that the government would not pursue defaulters.

“There are people who took Sh500 from the Hustler Fund and ran away with it. The loss is yours. Use your brains, my friends. That Sh500 you ran away with, no one will come after you for it,” President Ruto said.

Strangely, despite the losses, in May this year, the government was set to write off Sh6billion in defaulted Hustler Fund loans while seeking an additional Sh5billion to sustain the initiative.

Appearing before the National Assembly’s Committee on Trade, Industry, and Cooperatives, Micro, Small, and Medium Enterprises Development on Wednesday, May 21, 2025, Principal Secretary Susan Mang’eni revealed that ten million borrowers who took loans in 2022 have failed to repay.

Despite this, she defended the fund’s performance, noting that 9 million borrowers remain active and continue to repay their loans. Mang’eni urged MPs to approve the additional funding, arguing that it would help increase loan limits for reliable borrowers and accommodate new applicants.

However, lawmakers expressed concerns over the fund’s sustainability, questioning whether injecting more taxpayer money into a struggling program was wise.

Launched in 2022, the Hustler Fund was designed to offer affordable digital loans to ordinary Kenyans, with billions of shillings disbursed to date. However, questions have periodically been raised about the platform’s transparency, loan recovery performance, and the robustness of its verification mechanisms.