Kenyan President William Ruto has announced a government loan programme aimed at the country’s youth and small companies. The Hustler Fund promises to give lower-cost loans to small-business entrepreneurs.
Hustler Fund will make personal loans over the phone ranging from $4 to $400 million with a 14-day payback term. Borrowers will be able to access the funds by dialling a USSD number or using a mobile phone application. Persons who borrow from the Hustler Fund will be charged an annual interest rate of 8% computed per day, and no assets would be required as collateral.
During the launch, President Ruto stated that Hustler Fund is “500 times cheaper than the average lender in the market,”
According to the government proposal, 5% of the loan amount would be channelled to a savings scheme in order to increase the country’s savings rate.
President Ruto has recently criticised excessive interest rates paid by banks and mobile phone loan businesses, calling them exploitative.
The Hustler Fund was a major campaign promise made by the president, who took office in September. He has pitched the fund, which is aimed at more than eight million individuals, as a lifeline for youth, women, and low-income groups who are unable to obtain loans from conventional lenders.
Mr. Ruto, government ministers, and corporate leaders from banks and telecommunications corporations engaged with small business owners like visual artists, fishmongers, and fashion designers who sold their items to them at the inaugural ceremony.