More than 800,000 Hustler Fund borrowers have defaulted on paying back their loans within the stipulated time, Data from the Ministry of Cooperatives and MSME Development has revealed.
Co-operatives and SMEs, cabinet secretary Simon Chelugui on Thursday, March 9, said that since it was officially launched 100 days ago, the Hustle Fund has disbursed a total of KSh 21.3 billion in loans.
Chelugui further revealed that of the 21.3 billion released, only KSh 11. 8 billion has been fully repaid within the stipulated time.
However, as of Thursday, March 9, over 800,000 Kenyans were yet to repay KSh 7.4 billion.
The loan is supposed to be repaid in 14 days failure to which a defaulter loses their credit score points.
Defaulters are given another period of 15 days to service their loan but an increased interest rate of 9.5% per annum.
If the loanee does not repay then they lose all credit scores and risk their account being frozen.
Chelugui however maintained that the government remains optimistic that all the defaulters will fully repay their loans and get back to the program.
“Bado tunawapa nafasi. lakini tunaamini kwamba kupitia kwa kuwakumbusha na kuwazungumzia umuhimu wa kulipa madeni yao, tunaamini watalipa na kurudishwa kwenye mpango huu,( We still give them a chance. but we believe that through reminding them and talking about the importance of paying their debts, we believe they will pay and be returned to this program),” Chelugui said.
President William Ruto launched the fund on November 30, 2022, to bridge the gap between low-income earners and access to affordable loans.
“I want to promise the country that the hustler fund is going to be on a single-digit interest and progressively for the smaller enterprises, we will begin with just a simple fee without interest,” Ruto promised on November 10, 2022.
