The Government through the National Assembly – Special Funds Accounts Committee is targeting MPESA and airtime balances of the Hustler Fund defaulters.
In a statement released on Tuesday, October 1, on the looming crackdown, the committee instructed the Financial Inclusion Fund, popularly known as the Hustler Fund, to submit a comprehensive list of loan defaulters.
“This will include defaulter’s names, amounts owed, and telephone numbers per constituency,” the directive cited. The committee that was chaired by Migori County Member of Parliament (MP) Fatuma Zainab revealed that the Fund, which has received over Ksh 13 billion, currently has a concerning default rate of 78 percent.
During the meeting, Principal Secretary Susan Mang’eni and Acting Chief Executive Officer (CEO) Elizabeth Nkukuu faced questions from lawmakers regarding the Fund’s management, as highlighted by audit reports.
However, the audit meeting was cut short after the Hustler Fund failed to submit evidence related to 19 outstanding audit queries for the 2022/2023 financial year.
At the same time, the Committee demanded an explanation for the delay, to which Nkukuu attributed the delay to miscommunication.
In addition, Nkukuu further attributed the failure to a previous shortage of staff within the Fund, resulting in a reliance on guidance from the Office of the Auditor-General.
Lack of Qualified Hustler Funds Personnel
Legislators expressed concerns citing that the Hustler fund lacks qualified personnel. Legislators then questioned how the Fund could manage Ksh. 13 billion in disbursements without adequate staffing.
“How can a fund have 13 billion to disburse but lack crucial personnel to track it?” asked Kivasu Nzioka.
On the other hand, Majimbo Kalasinga raised concerns about whether the Fund had any insurance coverage or risk management strategies in place at its inception.
In response to questions about risk management, Nkukuu affirmed that the funds were not insured.
Additionally, Christine Ombaka sought clarification on the measures taken for debt recovery.
Through the Chairperson, Fatuma, the committee gave a way forward to the Fund’s management to provide detailed information on the defaulters. The committee will also lead an inquiry to verify the accuracy of the data.
The Hustler Fund management is expected to appear before the Committee again to address the pending audit queries.
Also Read: Oparanya Speaks on Listing Hustler Fund Defaulters in CRB
Government to Raid MPESA & Airtime Hustler Fund Defaulters
The government is looking forward to recovering Ksh 7 billion from 13 billion Hustler Fund defaulters. The government aims to do this by raiding their M-PESA accounts balances and airtime.
The Husler Fund CEO Elizabeth revealed the plan during the session with the National Assembly’s Special Funds Committee.
In an article published by The Eastleigh Voice, the CEO cited that discussions with Safaricom are ongoing on how the recovery process will be executed.
Further, the same publication cited that Nkukuu affirmed that most of the defaulters have the financial capacity and potential to repay their loans, based on their regular M-PESA transactions.
Also Read: Hustler Fund Defaulters: Oparanya Reveals How New System Will Track 19 Million Kenyans
Hustler Fund Loan
The Hustler Fund is a Digital financial inclusion initiative. It was designed to improve financial access to individuals to aid in micro, small, and medium-sized enterprises (MSMEs) in Kenya.
The Fund has, however, faced various challenges including borrowers failing to refund the loan.
This has raised concerns about how the recovery of the Ksh. 7 billion will be carried out from the 13 billion borrowers.
Follow our WhatsApp Channel for real-time news updates!
https://whatsapp.com/channel/0029VaB3k54HltYFiQ1f2i2C
