President Ruto shocker for Hustler Fund defaulters
President William Ruto.
What you need to know:
- President Ruto said the government had pumped an additional Sh10 billion into the hustler fund business accounts for the new hustler fund product.
- He regretted that while a good percentage of Kenyans have repaid their loans, there is another group that has decided to default.
Defaulters of the government-backed financial inclusion fund, popularly known as the Hustler Fund, will not be able to access the fund's new business loan facility.
President William Ruto on Wednesday announced that Kenyans who are yet to repay their individual loans secured from the Hustler Fund will have to settle the loan before they can access the new product facility known as the Hustler Group Loan.
Dr Ruto was speaking in the wake of growing concerns over the rising rate of default by Kenyans on individual loans secured from the Hustler Fund.
The current default rate stands at 29 per cent nationally.
President Ruto said the government had pumped an additional Sh10 billion into the hustler fund business accounts for the new hustler fund product.
He regretted that while a good percentage of Kenyans have repaid their loans, there is another group that has decided to default.
"We know that there is a percentage of Kenyans who are yet to repay their debts but I can tell you that they will not run far. We have put money in the business loan account but they will not get the loan until you clear your arrears," said President Ruto.
He was speaking in Rongai sub-county during the issuance of 1900 title deeds to residents of Majani Mingi and Lomollo settlements.
The President said in a bid to lift Kenyans out of poverty, the government has removed all defaulters from the Credit Reference Bureau (CRB) blacklist.
"We have added another Sh10 billion for business loans. Groups will get between Sh20,000 and Sh1 million, but before you get the Sh1 million, you must first pay the amount you borrowed," he said.
According to data released by Cabinet Secretary for Cooperatives and MSME Development Simon Chelugui on 16 July, the government had disbursed Sh33 billion in personal loans.
Of the total, at least Sh22,514,523,325 had been repaid and Sh1,654,102,355 represents savings already made.
In Nakuru, at least 77 per cent of the 878,000 borrowers have repaid, but 23 per cent have not. The total amount disbursed in the county is Sh2 billion.
On the Hustlers Group Loan product, President Ruto said the groups of at least 10 people will be able to access business loans ranging from Sh20,000 to Sh1 million at an interest rate of 7 per cent per annum.
The loan repayment period is six months from the date of disbursement, with borrowers having the option of repaying in instalments or in a lump sum.
