The Principal Secretary for the State Department for Micro, Small, and Medium Enterprises (MSMEs), Susan Mang’eni, has defended the department’s move to seek additional funding for the Hustler Fund initiative amid concerns over its effectiveness and loan repayment rates.
Speaking during the 42nd Annual Institute of Certified Public Accountants of Kenya (ICPAK) Seminar in Mombasa, Mang’eni underscored the fund’s importance in providing financial access to low-income Kenyans who traditionally lack access to formal credit.
“When we launched the Hustler Fund, we were addressing a market failure,” Mang’eni said.
“The majority of Kenyans at the bottom of the economic pyramid could not access affordable credit due to a lack of visibility in formal financial systems.”
She further explained that traditional lenders often require collateral such as pay slips, logbooks, or title deeds, which many citizens cannot provide but the Hustler Fund was designed to fill this gap by offering unsecured loans through a simple application process accessible even on basic mobile phones via the *254# USSD code, with no airtime charges incurred.
According to Mang’eni, the fund has reached 25.8 million Kenyans, approximately three-quarters of the adult population, since its inception.
Beneficiaries begin with personal loan limits ranging from Sh500 to Sh50,000, with the potential to grow their limits through consistent borrowing and timely repayment.
“The uptake has been impressive. Every day we disburse over Sh50 million,” she noted. “However, as users build their credit limits, there is a growing need for additional capitalization to sustain and expand access.”
Mang’eni also highlighted the introduction of the Hustler Fund Bridge Product, launched in December 2024, targeting borrowers with strong repayment histories. Under the initiative, eligible participants, those rated in higher performance bands (A and B) within a newly established 9-band credit rating system, can now access loans of up to Sh150,000.
The rating system, ranging from A1 to C3, categorizes borrowers based on their repayment discipline. Mang’eni stated that about 4.5 million Kenyans currently fall under the A and B categories and qualify for the Bridge Product.
In response to concerns about defaulted loans, Mang’eni maintained that the government has mechanisms in place to ensure accountability.
“We know those who have not paid. We are not considering write-offs at this stage,” she said. “We plan to introduce a Hustler Fund clearance certificate, similar to the HELB and Certificate of Good Conduct, to incentivize repayment.”
The long-term vision of the programme, she said, is to include every Kenyan upon turning 18 years old, enabling them to begin building a formal credit history early in life.
By Sitati Reagan
