The Ministry of Cooperatives has dismissed claims that the Financial Inclusion Fund, commonly known as the Hustler Fund, was disbursed to unborn children and minors.
Appearing before the National Assembly Departmental Committee on Trade on Thursday, March 6, Cooperatives Principal Secretary Susan Mang'eni refuted these claims, explaining that the discrepancies were due to errors in data extraction rather than the actual misallocation of funds.
According to the PS, the ministry has since cleaned up the records, and all individuals sampled have verified identity cards and telephone numbers.
“The data used in the audit report contained significant extraction errors because the audit was not conducted in a live environment,” Mang'eni explained.
She went on to add, "We have since cleaned up the records, and all individuals sampled have verified identity cards and telephone numbers."
Mang'eni assured the committee that the Hustler Fund’s system does not allow minors to access loans, adding that the government is committed to transparency and accountability in managing the fund.
The PS further informed the committee that as a flagship initiative, Hustler Fund's main role was to support small businesses and individual entrepreneurs.
“The Hustler Fund remains a critical tool in driving financial inclusion and economic empowerment, with proper safeguards in place to ensure funds reach the intended beneficiaries,” she noted.
The clarification follows a recent report by the Auditor General, Nancy Gathungu, who revealed that Ksh31.8 million was disbursed to 44,167 underage beneficiaries and unborn borrowers with future birth dates.
According to the Auditor General, 1,186 children aged between 10 days and 17 years received a total of Ksh681,395 from the Hustler Fund, while 42,981 individuals with future birth dates received Ksh31,135,690.
"A review of the customer and opted-in datasets provided revealed that some customers were below the mandatory age of eighteen (18) years, while others had birth dates set in the future, beyond 30 June 2024," Gathungu stated.
"In these circumstances, loan agreements with underage individuals are potentially unenforceable and increase the likelihood of default," she added.
