The Kenya Human Rights Commission (KHRC) has called for a comprehensive overhaul of the Hustler Fund, warning that the initiative risks turning into “quick money turned dead money” if urgent reforms are not undertaken.
The Hustler Fund, launched by President William Ruto in November 2022, was marketed as a financial lifeline for millions of low-income Kenyans, including boda boda riders, informal traders, and small-scale entrepreneurs, collectively dubbed “hustlers.” However, nearly two years later, a new KHRC study paints a grim picture of the fund’s performance, citing deep-rooted structural flaws, high default rates, and limited impact on enterprise growth.
The KHRC report, compiled using a mixed-methods approach, including interviews with fund managers, telecom partners, traders, and beneficiaries, reveals that many Kenyans are disillusioned with the program. Key among the concerns is the size of loans issued, which many recipients say are too small to support meaningful business activity.
“We are being given Sh300 or Sh500 in the name of the Hustler Fund; what business can you start with such an amount?” one borrower asked, while another, Joyce Wanja, a shopkeeper, lamented, “Even though the Hustler Fund was intended to help businesses, it has provided little benefit to mine. The amount is insufficient to purchase stock; I can only use it for emergencies.”
The study highlights that loans must be repaid within 14 days, with interest rates rising from 8% to 9.5% in case of default. These terms have contributed to widespread repayment challenges. By December 2022, the default rate had soared to 68.3%, and by June 2023, 78% of overdue accounts were in arrears for over 90 days.
Some borrowers admitted to misusing or deliberately defaulting on the loans. “They are telling us to take the loan. I will take it, but not repay it. What will they do to me?” said a respondent from Nairobi, revealing a worrying attitude toward accountability.
Others, such as street vendors, avoid the fund entirely due to precarious business environments. “I cannot take the Hustler Fund because, as a vendor, City Council can come and confiscate my goods, and I will not be able to repay,” one trader explained.
The report also reveals low levels of financial literacy among potential beneficiaries. A staggering 45% of Kenyans depend on friends for financial advice, while only 2.9% seek guidance from financial institutions. KHRC argues that the absence of business development support has rendered the fund largely ineffective in stimulating sustainable economic activity.
While some boda boda operators reported modest benefits, such as using the loans to service motorbikes or buy spare parts, most agreed that the amounts and terms were unsuitable for larger ventures. “With the Hustler Fund, most operators can buy small spare parts and repay after two weeks,” noted one boda boda chairman. “But for bigger ventures, it is useless.”
KHRC is now urging the government to redesign the fund with more realistic loan sizes, extended repayment periods, and integrated financial literacy training. Without such reforms, the Commission warns, the Hustler Fund may continue to serve more as a political tool than a genuine driver of economic empowerment.
“Unless these systemic issues are addressed,” the report concludes, “the Hustler Fund risks becoming a politically driven project with little economic benefit for Kenya’s hustlers.”
The findings raise serious questions about the long-term viability and intent of one of President Ruto’s signature economic programs, putting pressure on policymakers to deliver more inclusive and impactful financial solutions for the country’s informal sector.
Written By Rodney Mbua
