MPs Order List of Hustler Fund Defaulters as MPs Grill Cooperatives Ministry Over Loan Mismanagement

The National Assembly's Special Funds and Accounts Committee has ordered the Cooperatives Ministry to submit a comprehensive list of Hustler Fund loan defaulters. The directive was issued on Tuesday as lawmakers raised concerns over the fund’s staggering 78 percent default rate, casting doubt on its management and recovery efforts.

Cooperatives Principal Secretary Susan Mang’eni, appearing before the committee, was instructed to compile and submit a detailed list of defaulters, including their names, amounts owed, and contact information, broken down by constituency. The committee, chaired by Migori Town MP Fatuma Zainab, stated that the information would be crucial in verifying the accuracy of borrower data and tracking down defaulters.

This move comes after it was revealed that over KSh 13 billion had recently been disbursed through the Hustler Fund, with millions of Kenyans defaulting on their loans. Lawmakers expressed deep concerns over how such a large sum could be mismanaged, particularly in the absence of qualified personnel to oversee the fund’s operations.

The high default rate, confirmed by the Ministry, has caused significant alarm among MPs. Mbooni MP Kivasu Nzioka questioned how the fund could disburse billions without proper staff to track the loans. “How can a fund have KSh 13 billion to disburse but lack crucial personnel to track it?” Nzioka asked during the session.

The committee’s scrutiny also revealed that the Hustler Fund is not insured, which could pose significant challenges for the government in recovering the vast sums already turned into bad debt. Lawmakers grilled Ministry officials over their failure to provide documents related to 19 outstanding audit queries from the 2022/2023 financial year, with Ministry officials citing miscommunication and staff shortages as reasons for the delay.

The pressure on the Ministry comes just weeks after Cooperatives Cabinet Secretary Wycliffe Oparanya announced the government’s intention to crack down on Hustler Fund defaulters. Addressing the Kenya Private Sector Alliance (KEPSEA) conference in August, Oparanya revealed that 19 million out of 21 million Kenyans who borrowed from the Hustler Fund had defaulted, further heightening concerns over the fund’s sustainability.

“We are coming up with a system that will now track you to know where you are. You will soon see someone knocking on your door telling you to pay back the Hustler Fund,” Oparanya warned during the conference.

The committee also censured the Ministry for its failure to provide evidence regarding audit queries, including discrepancies in fund management and the Ministry's reliance on guidance from the Auditor General's office. This gap in documentation has only intensified concerns about the fund's transparency and accountability.

The National Assembly's latest directive underscores the growing unease surrounding the management of the Hustler Fund. As MPs push for greater transparency and accountability, the focus now shifts to how effectively the Ministry can track and recover the loans, and whether the fund can avoid turning into a national financial liability.