Oparanya vows to crack down on Hustler Fund defaulters as he takes over from Chelugui

Newly appointed Cabinet Secretary for the Ministry of Cooperatives and MSMEs, Wycliffe Oparanya, has vowed to crack down on millions of Kenyans who have defaulted on their Hustler Fund loans.

In an interview with Citizen TV on Thursday, coming just a day after taking over from his predecessor Simon Chelugui, Oparanya revealed that a staggering Ksh.12 billion remains unpaid by defaulters.

“Those who borrowed from the Hustler Fund registered with their ID numbers. Even if they replace their SIM cards, we can still trace them,” he said.

Oparanya further emphasized the ministry's goal of fostering an entrepreneurial spirit among citizens, particularly targeting 15 million Kenyans in the informal sector and small businesses.

He urged recent university graduates to explore entrepreneurship amid the stiff competition in Kenya's job market.

“I want to advise university graduates to start their businesses instead of seeking formal employment,” Oparanya said.

The ministry, in partnership with the World Bank, has secured Ksh.33 billion to support small businesses.

Oparanya explained that part of the funding will be used to train small business owners, after which they will receive a certificate of completion. Once registered and licensed, these businesses will be eligible for loans of up to Ksh.50,000.

Notably, the recipients of these loans will not be required to repay them; instead, the government, having received the funding from the World Bank on behalf of Kenyans, will bear the repayment responsibility.

Oparanya's strong stance on Hustler Fund defaulters marks a notable shift, especially after previously expressing reservations about the fund while still in the opposition.

“While I had my concerns initially, I now recognize the positive impact the Hustler Fund can have on empowering Kenyans despite the challenges and concerns it raises, though they can be addressed,” he acknowledged.

As he assumes office, Oparanya has his hands full with several ongoing challenges from his predecessor, Chelugui, who led the ministry for the past 18 months.

Chelugui, during the handover on Wednesday, underscored the critical issues of governance and mismanagement in the cooperative sector, urging Oparanya to prioritize the passage of the Cooperative Bill which is currently in Parliament to address these issues and strengthen governance structures within the sector.

The coffee industry will also be a key focus for Oparanya as Chelugui attested to the presence of conflicting and competing interests.

The Coffee Bill, also still in Parliament, seeks to revive the Coffee Board of Kenya and enhance coffee marketing efforts. Chelugui stressed the need for robust government intervention to protect coffee farmers.

Additionally, Chelugui pointed out that the completion of the transfer of wholesale and retail policy responsibilities from the Ministry of Trade to the Ministry of Cooperatives and MSMEs is now in Oparanya’s docket.

Ensuring clarity in the roles of Principal Secretaries within the ministry’s two State departments will also be vital for effective policy execution.

“The distinct functions of the PSs must be clarified to allow the CS to provide focused leadership across the ministry,” Chelugui emphasized.

Another pressing challenge for Oparanya will be improving access to affordable credit for MSMEs. Strict eligibility requirements from commercial banks have hindered entrepreneurship in Kenya, and Oparanya will need to find solutions to these barriers.

He must also address the issue of inter-county taxes that stifle trade, including taxes on goods like muguka and miraa from Meru County, which are heavily taxed at multiple county borders before reaching Mombasa County.

As Oparanya begins his tenure, all eyes will be on how he navigates these challenges and whether he can effectively steer the ministry to empower small businesses and cooperatives across Kenya.