State doubles Hustler Fund borrowing limit
Hustler fund borrowers have a reason to celebrate after the government increased borrowing limits by up to 100 per cent in a bid to ensure Kenyans reap its full benefits.
While highlighting the fund’s progress, Cooperatives and MSME Development cabinet Secretary Simon Chelugui pointed out that a review of individual limits has been concluded.
The changes, he said in a press statement, were effected from February 15, in line with last week’s directive of President William Ruto.
Noting that the limits have been doubled up according to individual’s borrowing and repayment record, Chelugui described the progress so far as impressive saying that the fund had surpassed all projections.
“We have witnessed tremendous growth the first two and a half months of Hustler Fund. We aregetting very positive feedback from beneficiaries and this is one of the reasons why we have increased the limits,” said Chelugui.
He said slightly more than Sh18 billion had been disbursed so far from 30 million transactions adding that repayment had surpassed the 50 percent mark.
“Meanwhile, savings account now stands at Sh912 million”, the CS said.
The CS, however, explained that the increment will only benefit those who have borrowed repeatedly and dutifully repaid their loans.
“Meaning, therefore that the changes will be implemented on a case by case basis. The increment is based on individual’s record. One’s loan limit will be based on how regularly one borrows and repays their loan facility,” he said.
He further added, “As we speak, many Kenyans have already seen their limits double up because we effected the changes in the last couple of hours. For instance, those who were getting, let’s say, Sh3,000 are now getting Sh6,000 and, those who were getting Sh5,000 are now getting Sh10,000 which means by mid-year, the one’s with the highest limits will be inching towards Sh50,000 which is the maximum for this product,” he stated.
Chelugui assured Kenyans that the Hustler Fund will be reviewed every four months adding that borrowers will be rated according to their repayment history.
“The National Treasury has supported us and has already disbursed the Sh1.8 billion required to the trust accounts. We have wallets held in two banks, KCB Bank and Family Bank, and they are the ones who now inject liquidity into the mobile money wallets of borrowers,” he said.
The Hustler Fund is a policy intervention to save those at the bottom of the economic ladder through affordable credit by cushioning them from predatory lenders. But besides credit, the Fund aims to promote a savings culture, investment, and social security to the vulnerable members of the society (hustlers).
The Cabinet Secretary said that the Head of State will also launch a new Hustler Fund dubbed Micro Credit which is designed for Saccos, Start-ups and groups where they can borrow on behalf of their members before the end of the month.
“This is a bigger loan facility ranging from Sh250, 000 to Sh2.5 million,” he said, adding that the money will be channelled through financial institutions.
The Hustler fund has four products, namely Personal Loans, Micro business, SMEs and Start-up Loans targeting various segments of the population. Since its inception, Sh18. 5 billion has been disbursed from some 30 million transactions.
“Indeed, I am proud of the progress we have made so far. We continue to receive very positive feedback from the targeted groups such as fruits and vegetable vendors (mama mboga), jua kali and boda boda operators,” said Chelugui.
“So far, the Hustler Fund has surpassed all projections and existing records in the financial sector in just under three months,” he said.
“We have received positive stories from borrowers who have properly utilised their loans to stabilise and expand their business. This is very encouraging,” he added.
He called upon beneficiaries to borrow and repay promptly saying this is the only way they are going to grow their limits. Personal loan product ranges from a minimum of Sh500 and a maximum of Sh50, 000.