Affirmative action funds rolled out during the presidencies of Mwai Kibaki and Uhuru Kenyatta are losing steam, even as the current administration pivots towards newer, tech-led lending vehicles such as the Hustler Fund and the Nyota initiative.
Fresh data shows that the Uwezo Fund and the Women Enterprise Fund fell well short of their lending goals in the last financial year. The underperformance signals a marked departure from earlier periods when the two schemes formed the backbone of state-backed credit for women, youth and persons with disabilities.
Disbursements under the Uwezo Fund slipped to Sh431.4 million in the year to June 2025, missing the Sh600 million target and retreating from the Sh543.2 million issued in 2023-24. That previous year had seen the fund outperform expectations after grassroots mobilisation and eased borrowing conditions boosted uptake. The State Department for Micro, Small and Medium Enterprise Development attributed the latest shortfall to operational snags at constituency level, which slowed approvals and payouts.
In its budget proposals for the coming fiscal cycle, the department disclosed that 80 constituencies were dormant while 20 lacked committees altogether, effectively paralysing sections of the programme. The Uwezo Fund, set up in 2013 during Kenyatta’s administration with William Ruto as deputy president, was designed to provide interest-free loans and capacity building through constituency structures.
Its subdued showing contrasts sharply with the expansion of the Financial Inclusion Fund, better known as the Hustler Fund, now the flagship of the Kenya Kwanza government’s enterprise financing drive. By the close of the review period, the Hustler Fund had channelled more than Sh72 billion to roughly 26 million Kenyans. That figure represents a steady climb from Sh35 billion in 2022-23 and Sh52 billion in 2023-24, effectively dwarfing the scale of the older affirmative action vehicles.
Yet the rapid disbursement has not been matched by Treasury allocations. By June 2025, the fund had received Sh14.8 billion from the Exchequer, a far cry from the Sh50 billion pledge made when President Ruto took office in September 2022. The disparity has sparked questions about how sustainable the programme will prove over time.
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Meanwhile, the Women Enterprise Fund, established in 2007 under Kibaki, endured one of its weakest years on record. It released just Sh457 million against a target of Sh2.7 billion in 2024-25, down sharply from Sh941 million the previous year and Sh1.72 billion in 2022-23. For nearly two decades, the fund had been the government’s primary instrument for widening women’s access to affordable credit.
Officials from the State Department for Gender and Affirmative Action blamed the slump on the suspension of WEF’s digital lending model, citing poor repayment rates and mounting defaults. They also acknowledged that performance targets had not been recalibrated to reflect the shift towards digital platforms.
The budget squeeze translated directly into reduced reach. Only 12,538 women entrepreneurs received funding during the review period, a fraction of the 200,000 target and a dramatic fall from the 189,550 beneficiaries served in 2023-24 when digital applications had surged.
Taken together, the figures point to a changing philosophy in state-backed lending. Constituency-based funds anchored in local committees are giving way to centralised, mobile-driven credit pipelines. Whether that transition expands opportunity or simply reshuffles risk will depend less on the slogans attached to the funds and more on repayment discipline, fiscal backing and institutional stamina.
