CS Chelugai responds to reports of irregularities in Hustler Fund disbursement

By Peter Ochieng

Cabinet Secretary for Co-operatives and Micro, Small and Medium Enterprises (MSMEs) Simon Chelugui has finally broken his silence over allegations of irregularities in disbursement of the Sh5 billion Hustler Fund.

The issues were raised by Auditor General Dr. Nancy Gathungu. In her findings, she cited inconsistencies in the management of the fund, adding that the management failed to provide financial statements for audit review, which prevented verification of the source and authenticity of the balances.

The recovery process from exchange transactions, the Auditor General said, is riddled with doubts, with her analysis revealing that 17,855,858 beneficiaries applied for loans, amounting to a total disbursement of Sh32,015,962,276.

Unfortunately, a substantial balance of Sh10,950,075,614 remained unpaid as of June 2023, including interest receivable and loans outstanding. Gathungu said she found out that Sh259,026,553 held by service providers could not be confirmed due to inadequate documentation provided by the fund's management.

However, in his response while addressing the press on Tuesday dismissed reports of irregularities in the Hustler Fund stating that issues raised by the report were further from the truth. The CS said that all the money given to hustlers has been accounted for and that no coin has been lost, adding that by the time of the launch of the fund 18 months ago more than 8 million Kenyans were blacklisted by Credit Reference Bureau (CRB), saying that they sought to correct the issue through the Fund.

"We sought as an administration to correct and address those market failures by establishing Hustler Fund," said the CS.

Chelugui added that by Monday, July 08, 2024, Hustler Fund had distributed over Sh54 billion and loan repayment of over Sh42 billion. “A total of 23 million Kenyans have opted in and have transacted,” he added.

During campaigns ahead of the 2022 polls, President Wiliam Ruto, then Deputy President promised to initiate a kitty for Kenyans to access loans to boost their businesses.

The Fund became operational soon after being sworn in in September, 2024.