Hustler Fund Audit Flags 87% Loans Overdue Past 1 Year

In Short

Kenya’s Auditor-General has told Parliament that the Hustler Fund is struggling to collect most of the money it has lent out.

What Happened

The Auditor-General’s report on the year ended June 2025 says 87% of the Hustler Fund’s outstanding loan book is overdue by more than one year. That overdue amount is KSh 13.2 billion.

The report also raises questions about the Fund’s record keeping. It says the Fund’s own records show no loans that are less than a year old. Yet the audit found more than KSh 2 billion in new loans were issued during the same period.

Another red flag is around loan accounts disbursed through Safaricom. The audit found hundreds of thousands of these accounts were marked as closed even though borrowers still owed a combined KSh 377.5 million in unpaid principal. Principal is the original amount borrowed, before any fees or interest.

The Auditor-General also flagged weak data controls and unresolved issues from prior audits. It reportedly pointed to a “Bridge Loan” product that may not have received proper approval. A bridge loan is short-term credit meant to cover a gap until a borrower gets other funding.

Why It Matters

Hustler Fund is a public lending programme, so weak collections can quickly turn into losses borne by taxpayers. A large overdue book also makes it harder to recycle repayments into new loans for small businesses and informal workers.

For Kenya’s digital lending ecosystem, the report is another reminder that fast disbursement needs strong controls. That includes accurate loan ageing data, clear product approvals, and dependable account status tracking, especially when lending is distributed through mobile money rails.