Hustler Fund Acting CEO Elizabeth Nkukuu.
Thirteen million Hustler Fund defaulters will have their M-Pesa accounts and airtime raided by the State in order to recover Sh7 billion owed.
Acting Chief Executive Officer of Hustler Fund Elizabeth Nkukuu told a parliamentary committee that they are currently engaging Safaricom on how to go about the process in order for government to recover the colossal amount.
Appearing before the National Assembly committee on Special Funds Tuesday, Ms Nkukuu told MPs that the defaulters are mostly those who borrowed various amounts in the first two months of the Fund's launch.
“This is a conversation that is still ongoing with the mobile operator,” Ms Nkukuu told the committee.
She told the team chaired by Migori Women Representative Fatuma Mohammed that details of those that have defaulted are available and all legal means will be used to recover the amounts owed.
So far, at least 24 million Kenyans have borrowed Sh57.8 billion from the Fund, with two million people currently with good financial credit.
She revealed that for every amount borrowed, five percent is retained and goes to the savings of the members which currently stands at Sh3.5 billion
Ms Nkukuu said the eight percent charged as interest rate is divided among the mobile operators, banks, secretariat and part of it used for growth of the Fund.
Can pay, won't pay
Interestingly, Ms Nkukuu told the committee that those who have defaulted are people with means to pay, going by their monthly transactions.
“It’s not that they cannot pay. They are people who just don’t want to pay,” Ms Nkukuu said.
Besides recovering the money from their M-Pesa and airtime, she said the State will also deploy a "nagging" technique that involves calling defaulters to remind them to pay back their loans.
“After this, we will now use legal means to get the money from their wallets or airtime,” Ms Nkukuu said.
“We have checked the numbers and it shows that 98 percent are still active. That gives us hope that we can still recover the money. To those that have borrowed and have died, we have no option, there is nothing we can do about it but they are only about two to three percent.”
Ms Susan Mang’eni, the Principal Secretary in the State Department for MSMES, takes oath of office during the swearing-in of Principal Secretaries at State House, Nairobi on December 2, 2022
Her sentiments were echoed by the Principal Secretary for Micro, Small and Medium enterprises, Ms Susan Mang’eni, who said the defaulters have been given enough grace period.
“We are going to segment them then institute a forceful recovery. We know them...we have their mobile numbers, unique identifiable numbers and their ID numbers with us,” Ms Mang’eni said.
“If we had started chasing them in the first month, they would have said it’s too soon and they have issues but now we have given them two years. That is enough time.”
Launched in November 2022, Hustler Fund is a product of political promises made by President William Ruto while campaigning ahead of August 2022 General Election. The main aim of the programme is to advance affordable credit to masses that were locked out of mainstream financial institutions.
