President William Ruto defends Hustler Fund, says KHRC report politically motivated

President William Ruto has defended the Hustler Fund, dismissing claims of widespread defaults as falsehoods driven by political agendas.

Speaking on Wednesday during a presidential private sector roundtable, Ruto insisted that the Financial Inclusion Fund, commonly known as the Hustler Fund, is a transformative initiative that has empowered millions of Kenyans locked out of traditional financial systems and remains a central pillar of his bottom-up economic agenda.

“I take pride in the success of the Hustler Fund under the Financial Inclusion Fund, a pioneering empowerment initiative. In just under three years, it has disbursed over Sh72 billion to 26 million Kenyans, mobilised over Sh5 billion in savings and provided vital working capital to millions of micro-entrepreneurs, proving that even the smallest businesses can thrive with the right support,” Ruto said.

Ruto criticised those questioning the fund’s impact, accusing them of misrepresenting facts and failing to understand the economic challenges faced by ordinary Kenyans.

“Our critics, the naysayers, the perpetual pessimists and the chorus that never sees anything working in Kenya, would have you believe that the Hustler Fund is a failure, as it is indicated in today’s newspapers. They say this because they either do not understand or refuse to acknowledge the daily realities of millions of Kenyans. This fund was designed to empower,” he said.

He also called out the criticism from what he described as detached elites.

“I want to persuade my good friends, you know the people who talk from Nairobi, they talk to us from posh hotels. You know, they have money from this NGO and that NGO and the other one, please… There are Kenyans who today have a mechanism for them to borrow money,” he said.

The president defended the savings aspect of the fund, saying that borrowers who previously had no safe way to save are now protected.

“These small people who borrow Sh1,000, Sh2,000, Sh5,000 and Sh10,000 - they have mobilised 5 billion shillings in savings over the last three years… They did not have a mechanism for where to save without going into a place where their money could be lost. Now they have a mechanism under Hustler Fund that has the backing of the government of Kenya,” said Ruto.

He pushed back against reports claiming a 60 per cent default rate, stating that data shows the fund’s recovery rate is 83.3 per cent, nearly matching the 83.6 per cent recorded by banks.

“Now those same critics are spreading fear and responsibility by falsely claiming that the fund has a 60 per cent default rate. That is a deliberate distortion of facts. The truth backed by data is that the Hustler Fund has a recovery rate of 83.3 per cent,” said the president.

“What exactly are these people telling us,  that ordinary, hardworking Kenyans are serial defaulters? Of course, they are not. Kenyans are better than that. Kenyans are honest. Kenyans are resilient. Given the right tools and a fair chance, Kenyans will always do their part,” he added.

Ruto vowed to stay the course despite criticism, saying the government would not be shaken in its mission to build an inclusive and equitable society.

“We will not be distracted. Those who, when facts do not serve their agenda, resort to fabricating narratives to prop up their falsehood… We remain unchallenged in building a new, inclusive, fair, equitable society,” he said, calling on the private sector to continue supporting the government’s vision.

His defence of the fund comes just a day after the Kenya Human Rights Commission (KHRC) released a damning report calling for the immediate closure of the Hustler Fund. In its findings titled

“Failing the Hustlers,” KHRC criticised the design and implementation of the fund, arguing it has failed to achieve its empowerment goals.

KHRC said the fund’s 14-day loan repayment window is unrealistic and sets up low-income borrowers for failure.

“Expecting a small business to take a Sh500 loan, generate returns, and repay it within two weeks is not just impractical, it borders on financial sabotage,” the report said.

Despite the disbursement of over Sh53 billion by September 2024, the commission claimed there was no measurable impact on job creation or enterprise growth.

It pegged the default rate at 68.3 per cent, with Sh340 lost for every Sh500 disbursed,  pushing the projected cost to the taxpayer to 71.5 per cent.

The report further raised concerns over poor loan recovery structures, a lack of transparency, and misuse by some borrowers, warning that the fund is economically unsustainable.

KHRC urged the government to redirect the money to more accountable and decentralised financial inclusion systems tailored to the actual needs of low-income citizens.