KCB responds to auditor queries on Hustler Fund

President William Ruto during launch of Financial Inclusion Fund in November 2022.

KCB Bank Kenya Limited has issued a response to the queries raised by the Office of Auditor General on Financial Inclusion Fund (Hustler Fund).

Auditor General Dr Nancy Gathungu had issued a disclaimer opinion, citing inconsistencies in the management of the fund.

Through a statement from the bank Managing Director  Annastacia Kimtai , the financial institution indicates that the lender received nine audit queries out of which four touched on KCB Bank’s IT system.

Kimtai said the bank has had meetings with the auditor general’s office and other service providers on the issues that were raised.

KCB had partnered with National Government KCB through the Ministry of Cooperatives and MSME in implementation and operationalization of the Hustler Fund for purposes of driving and expanding financial inclusion for Kenyans.

In a response to the audit queries raised KCB indicated that the auditor had shared a file of five records of customers who had been on boarded on HF product without National IDs but upon investigation four were found to be from Safaricom while one was from Airtel, the Bank said the system failed to update their records over a transient technical issue.

From the bank records the Airtel customer borrowed once and full paid, the bank is working with service providers to identify and update National IDs of the affected customer profiles.

According to the auditor, some IDs were used to process more than one loan whereby 867 IDs were used to process 1,978 loans amounting to KSh477,928.

The bank investigated the issue and found out this remained consistent with the product rule of the on loan per customer at a time up to their credit limit.

These were cases of customers topping up their existing loans, but within their signed credit limit.

For loan top ups as opposed to new loan requests, the system maintains the same loan contract (loan ID) as a principal increase to the existing loan.

On clients who received loans that were above their limits, the auditor noted that four people received a combine KSh3,400 in loans as opposed to KSh2,700 which should have been their revised limits.

On investigations the bank noted from each of the cases in the dataset shared the customer did not receive loan amounts above their limit.

These cases are cases where customer had a higher credit limit at the time of access which later revised downwards before the customer had repaid.


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The auditor also noted that two people received a combined KSh1.648 loans as opposed to KSh1,000 which should have been their initial limits.

On investigations from each of the cases in the dataset shared the customer did not receive loan amounts above their limit.

For each case the customer requested a loan, repaid partially and requested again as top up, all within their credit limit.

At no given time did their outstanding principal loan amount surpass their credit limit.

On the issue of disbursement of loans to clients not opted into the fund, the auditor shared a file of 98 records with Airtel and Telkom customers (to be addressed by KCB).

On investigation they noted all the customers opted in in/registered on the Hustler Fund Product before accessing the loan.

However as part of KCB business process, their mobile numbers were delinked/ recycled from the product consequently their loan portfolio was archived.

The record for the loan with the national ID remains in the records as an outstanding debt to the ID reference.

By Obegi  Malack


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