Nairobi Kenya — President Ruto says the government will operationalize Hustlers Fund before December to ensure the availability of credit to small businesses at single-digit rates.
Speaking at the inauguration of the Thiba Dam in Kirinyaga, Ruto said the Hustler Fund will help in lowering the cost of credit for small business, ensuring that everyone can borrow money at a reasonable rate and hence resolve the shortage of resources for managing small businesses in the country.
“I want to assure Kenyans that the Plan to implement the Hustler Fund will be ready before December this year,” he said.
“We are already amending and testing it and when I am doing all this planning, you need also to organize yourselves in terms of enrolling into saccos, groups and cooperatives.”
Ruto said he has put in place a specific department to handle cooperatives, Small and Medium-Sized Enterprises (SME), Chamas and Saccos.
“When am planning how to disburse money on my side I want you to prepare how to receive the money in the named groups,” he added.
“I can’t disburse government money anyhow, there has to be a strategy on how you are going to receive the money in an accountable manner.”
“We are going to let you know how much the single-digit rate will be but we will ensure the fund is implemented for everyone and those who are going to benefit to use it well.”
President William Ruto made the pledge to create a Hustler Fund in his 2022 campaign manifesto and followed up the commitment in his inauguration speech on September 13.
He said individuals in the low-income bracket he called “hustlers,” a will have access to affordable credit for their businesses through the proposed fund.
“We shall implement the Hustler Fund, dedicated to the capitalization of micro, small and medium-sizes enterprises through chamas, saccos and cooperatives to make credit available on affordable terms that do not require collateral,” he said in his inaugural speech at Nairobi’s Kasarani Stadium.
Ruto also reiterated his commitment to reform the country’s credit system to eliminate what he termed an all-or-nothing credit score system.
He also promised to sustain his engagement with lenders to ensure interest rates are reasonable.
On September 28, Safaricom announced the slashing of fees on an overdraft facility supported by two local banks as part of a plan to promote access to credit to micro enterprises.
Ruto lauded the overhaul of the Fuliza loan product by Safaricom, Kenya Commercial Bank, and NCBA Bank, calling it a step in the right direction.
Safaricom slashed interest rates on Fuliza loans below Sh1000 by 40 per cent and introduced a three-day grace period for borrowers.
The new rates which became effective on October 1, charge a daily interest of Sh6 down from Sh10 for overdrafts between Sh500 and Sh1,000.
Further, those borrowing loans of between Sh101-499 will pay a Sh3 daily charge down from Sh5.
The new tariffs set a Sh18 charge down from Sh20 for overdrafts between Sh1,001 and 1,500.