Nine in Ten Hustler Fund Loans Are Overdue, Auditor-General Reveals

The Hustler Fund is still struggling to collect vast sums of the money it has lent out, with 87% of its outstanding loan book now overdue by more than a year, according to a new report from the Auditor-General submitted to Parliament. 

• The report, covering the financial year ended June 2025, found that KSh 13.2 billion of the Fund's loan receivables had gone unpaid for more than a year. 
• The Fund's own records claim it has no loans younger than a year old, even though the Auditor-General found it had issued more than KSh 2 billion in new loans during that same period.
• The audit findings paint a picture of an institution that kept expanding its lending footprint in the same year its existing loan book was falling badly behind on repayment, without oversight structures typically required before public money is put at risk.

Compounding the picture, the audit also found that hundreds of thousands of loan accounts disbursed through Safaricom's network were marked as closed even though borrowers still owed a combined KSh 377.5 million in unpaid principal. The Hustler Fund management provided no documentation explaining why the accounts were closed, a discrepancy that opens the question of whether the true scale of bad debt is even larger than officially reported.

Meanwhile, Hustler Fund rolled out a new lending product, the Bridge Loan, which accounted for close to 30% of everything the Fund disbursed over the period. The Auditor-General said they found no evidence that the product was ever approved by the Fund's Board of Trustees, its parent ministry, or the National Treasury, as required under public finance regulations. 

The ‘Bridge Loan’ is a higher-value loan for borrowers who have established a strong record of repaying their Hustler Fund loans on time, giving them access to more credit at relatively low interest rates. It is designed as a step up from the fund’s regular loans, allowing eligible business owners and entrepreneurs to borrow more to finance expansion, manage cash flow, or pursue new investments.

According to the audit, the Hustler Fund’s basic problem is that it does not run its own lending operations. Disbursements, repayments, savings withdrawals, and loan records are all handled entirely by outside service providers such as mobile network operators. The Fund has no independent system to check whether the data it receives from them is accurate and is thus unable to confirm the reliability of its own numbers.

The audit also found that more than 4.2 million registered borrowers had no loan limit set at all, and that thousands of them still received loans despite that gap. Separately, loans worth KSh 116.5 million were issued to customers whose national ID numbers were missing from the Fund's database entirely, while tens of thousands more loans went to borrowers who already had active balances outstanding, despite the Fund having no formal credit or debt-collection policy in place. 

The recovery problem is not new as sixteen issues flagged in last year's audit of the Hustler Fund remain unresolved. They include high non-performing loans, irregularly closed loan accounts, duplicated outstanding loans, and unrecovered revenue from service providers.