Kenyans have borrowed more than Sh20 billion from the Hustler Fund since it was launched on November 30, President William Ruto has said.
This marks a significant increase from the Sh9.58 billion that had been borrowed by December 20 according to statistics released by Cooperatives and Micro, Small and Medium Enterprises Cabinet Secretary Simon Chelugui.
President Ruto said many Kenyans continue to borrow from the government kitty to boost their businesses, adding his administration will increase the allocation to the revolving fund.
“We agreed that we are going to build this economy from the bottom up and we have started that journey. That is why we initiated the Hustler Fund and to date, Kenyans have borrowed over Sh20 billion to boost their businesses. We will increase the fund every month to ensure that Kenyans that borrowed Sh500 can borrow Sh50,000,” said President Ruto in Mombasa.
The Head of State said next month the government will launch the second phase to cater for Saccos and other small institutions to give all Kenyans an equal opportunity to borrow at a small interest to boost their businesses.
“We want to make sure the people who have been harassing Kenyans including cartels, brokers and shylocks look for other businesses,” added the President.
“We are making sure that our economy is founded on sound economic policies that will stand the test of time today, tomorrow and the years to come,” he said while speaking at State House Mombasa on the eve of New Year.
President Ruto exuded confidence that his administration has laid the foundation that will take Kenya’s economy away from dependence on debt and instead rely more on revenues raised from Kenyan taxpayers.
The Head of State said he is seeking to invest in areas that will drive the growth of the economy sustainably, insisting that Kenya will not be trapped in debt.
The Hustler Fund, one of the main planks of his campaign, was launched in November.
The government said the fund will offer much-needed relief to over eight million Kenyans who had been blacklisted by various credit rating agencies.
Besides being accorded a second chance to access the credit needed to grow their enterprises, the Hustlers Fund also offers affordable credit by charging an interest of 0.02 per cent per day, .
During the campaigns, President Ruto said loans from the Hustler Fund would not attract any interest to provide cheap credit for micro and small enterprises.
However, this changed after the President was sworn-in as he said it was impossible to offer free money.
The loan limits for individuals from the fund were set at a minimum of Sh500 and a maximum of Sh50,000.
Further, getting the amount is dependent on the borrower’s credit score, such that individuals with poor credit scores will be charged higher interest, plus possible penalties.
The government deducts 5 per cent of every amount borrowed from the fund and saves it on behalf of the borrower.
Mr Chelugui, said the move is aimed at promoting a saving culture among Kenyans.
The fund is expected to have a total of four products – Personal Finance (which has already been launched), Micro-Loan, SME Loan and Start-Up Loan.
Money given in the Personal Finance category has to be repaid within 14 days at an interest of 8 per cent, which is calculated on a daily.
To be eligible, one must be at least 18 years old, have a national identity card and a registered SIM card and mobile money account with Safaricom, Airtel or Telkom.
