President William Ruto in November 2022 launched the hustler fund meant to free businesses from unscrupulous lenders.
The loan which ranged between KSh 500 and KSH 50,000 was capped at 14 days in a plan that was set to open a window for small businesses to access cheaper credit.
However, in what mirrors the headache mobile lenders face advancing unsecured loans to the informal sector, hustler fund borrowers appear to be yet to repay the state-bucked financial inclusion fund.
President William Ruto’s adviser on matters of financial inclusion, Moses Banda on Tuesday, August 22, revealed that more than KSh 3 billion has not been serviced by the borrowers as per the agreed schedule.
He said out of the Hustler Fund’s outstanding KSh10.2 billion worth of loans, about KSh2.9 billion in Hustler Fund loans fall in the category of non-performing loans.
“Out of the KSh 33 billion that has been lent out [under the Hustler Fund], the outstanding loan book is about KSh 10.2 billion; remember these are short-term loans so they get repaid pretty fast. Out of the outstanding amount, 29 percent is not performing on time,
“So, about KSh7.9 billion of the outstanding amount is performing on time. Just like any other lending, there will always be challenges of non-performing loans,” Banda said as quoted by the Business Daily.
The challenge comes at a time when the Head of State has initiated talks with the World Bank for a KSh 20 billion loan to finance the Hustler Fund.
Kivumbi.co.ke understands that Nairobi Senator Edwin Sifuna had encouraged Kenyans not to fear going for the loan.
Sifuna, who is also the ODM senator said the scheme launched by the president had no legal recourse for the government of the day to go for the defaulters.
“I encourage Kenyans to take the hustler fund money because there is no legal recourse for the government to come after them because of not paying back,” Sifuna said.
