Treasury has proposed additional Ksh 10 billion allocation to the Hustler Fund which is expected continue providing affordable credit to individuals and Micro Small and Medium Enterprises (MSMEs) and encourage savings.
According to National Treasury and Economic Planning Cabinet Secretary Prof. Njuguna Ndung’u, the Financial Inclusion Fund which was established in November last year has received exchequer disbursement amounting to Ksh 11 billion out of the Ksh 20 billion allocated in the current financial year.
“This money has been revolving within the Fund, providing low interest loans at 8pc per annum to 16.07 million Kenyans, of which 7.1 million are repeat customers. So far, Ksh 30.8 billion has been borrowed from this revolving fund,” said Ndung’u.
The fund which also acts as a saving scheme has seen total savings by borrowers top Ksh 1.5 billion as mandatory savings, while Ksh 17 million has been saved on a voluntary basis.
“We have witnessed a phenomenal growth in the number of transactions that currently stand at 43.5 million. The largest number of times a single customer has borrowed from the Fund is about fifty times indicating strong traction to the Fund,” he added.
During Madaraka Day, the government launched the second product of the Hustler Fund which targets groups such as chamas and saccos who can now borrow loans of between Ksh 20,000 and Ksh 1 million.
Borrowers on the platform are currently charged an interest at the rate of 8pc annually based on their credit profiles.