Cabinet Secretary Ministry of Cooperatives and MSME Development Simon Chelugui has maintained that no money has been lost from Financial Hustler Fund.
The CS who issued a press statement on Tuesday July 9 said the Ministry has all documentation in connecting with the loans issued through Hustler Fund.
Auditor General Dr Nancy Gathungu had issued a disclaimer opinion, citing inconsistencies in the management of the fund.
The audit was between November 2022 and June 30 2023, seven months after launch of Hustler Fund.
The CS said the auditor only flagged out a number of issues that required clarity and additional information that bordered mostly on data reconciliation.
He said the audit was done during establishment of the fund, when the government had not gotten right team to run and coordinate the Hustler Fund.
Chelugui said the ministry together with its partners responded to the issues and provided the relevant data that was required.
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“The process took a bit longer and by the time the ministry responded, it was time barred as the audit report had to be tabled to Parliament as per constitutional timelines,” the CS said.
He noted that whereas they received the management responses, due to the timeliness they could not therefore rectify the system to establish the milestones that had been covered in data reconciliation and subsequent updates to address the audit quarries.
“I want to assure Kenyans that we have taken due process responded to every issue raised by auditor general, they had agreed to come back and audit the system relating to the Hustler Fund,” the CS said.
On issues of client identification, registration, it is not possible to access funding without traceable identity, the data is available and verifiable.
“Out of over 20 million borrowers in the review period, only 5 borrowers did not have their IDs captured,” the CS said, he noted that this was due to technical transition surge issue on December 1, 2022.
The issue on duplication of loan IDs was a case of customers topping up their existing loans but within their assigned credit limit.
For loan top ups as opposed to new loan requests, the system maintains the same loan contrast (loan ID) as only performs principal increase to the existing loan.
Chelugui said on concerns about data manipulation and integrity, the audit process was not in alive environment and therefore during data extraction there are possibility of having data errors due to the huge sizes.
“Some of this could be due to data truncation and reconciliation errors,” the CS said.
On limit enhancement the CS said the Hustler Fund personal product design provides room for the limit review, so far the government has had two limit reviews, the first one in February 2023 and the second one in December 2023 which introduced a savings led limit increase.
There were borrowers who saved voluntarily which boosted their loan limit increment.
The Hustler Fund is a digital platform and all record can be traced ranging from the date of applying the transactions IDs which can be provided of an entity meets data protection criteria.
The Financial Inclusion Fund also known as Hustler Fund had two products Personal loan launched on November 2022 and group product loans launched on June 1, 2023.
So far personal loans have attracted 23.6 million Kenyans taking KSh54.5 billion with savings of KSh3.1 billion.
The group product has so far attracted 23, 534 groups receiving KSh182.7 million.
The government will graduate one million Hustler Fund beneficiaries to conform to rehabilitation and credit repair function of hustler fund.
By Obegi Malack
obegimalack@gmail.com
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