Savings boost and doubled limits as Hustler Fund marks one year
President William Ruto, his deputy Rigathi Gachagua (second right) and other officials during the Hustler Fund’s first anniversary celebrations on Thursday in Nairobi.
President William Ruto opened the window for Hustler Fund users to access part of their Sh2 billion savings, besides a promise of increased loan limits as the fund marked its first anniversary on Thursday, November 30.
The Head of State also announced that the savings will receive a boost from the government and that they will earn 12 per cent interest this year after the government negotiated on the aggregated amount of total savings.
This interest rate will be annualised, but the exact rate will be determined by the Treasury bills interest rates.
For those who have saved Sh6,000 and above, they shall receive a top up of Sh3,000 beginning today, however, this will only be for those who have borrowed and repaid their loans from the fund at least five times.
For those who have borrowed over 10 times, some 1.2 million Kenyans, their loan limits have been doubled. Should one’s limit have been, for instance, Sh2,000, it will now shoot to Sh4,000.
The increased loan limit reward was also extended to those who have borrowed between five and 10 times—they will have their loan limits increased by 60 per cent. Those who have borrowed between two and five times will enjoy a 40 per cent increase in their loan limits.
All Kenyans registered under the fund will receive an update on how much exactly their limits have increased.
“Because you have shown that you are decent people and have always repaid loans given in your current limits, we will henceforth increase the limit. We are going to enhance the limit of 1.2 million regular borrowers,” President Ruto said.
Under the fund, for every amount borrowed, 5 per cent is deducted for savings and thus far, this pot has collected some Sh2 billion from borrowers.
“I told Kenyans, if you borrow and keep some savings, if you put two shillings, the government will give you one shilling. Today is that day, listen to me keenly because you will get money today. By tomorrow morning, 1.2 million Kenyans will have a matching fund in their savings ... If you have borrowed, and if you have saved up to Sh6,000, we are going to match with Sh3,000, below that, we are going to match in the ratio of two to one,” President Ruto said.
Withdraw
The Head of State also announced that Kenyans can now withdraw up to 30 per cent of their savings and use it to invest in their businesses, with the remaining 70 per cent being retained in the long-term savings plan.
“We must improve our savings culture as a country. You can however access the 30 per cent of your savings, but if you do not withdraw it, after a month, you will now not withdraw the 30 per cent of your savings, we will double your limit,” he said.
President Ruto said that Sh12 billion had initially been invested into the fund, and this has over the past year been used to disburse Sh39.5 billion to 21.7 million borrowers.
Of the total amount disbursed, Sh28.7 billion has been repaid. The Fund now also has 7.5 million repeat customers with its top borrower having being loaned a total of Sh4.5 million, while the top saver has Sh634,000 in savings.
The interest rate on the savings will mature on December 31, 2023 with the accrued amount being added to the savings.
“Everyone, on December 31, and every other December, be checking your phones, and you will be getting your interest money on the savings you have put in the Hustler Fund. The Treasury Bill rate minus 3 per cent will be the interest rate,” said the President.
Deputy President Rigathi Gachagua said the Hustler Fund was a life saver for the many small business people in the country who voted for the Kenya Kwanza administration and urged county governments to be kind when dealing with them.
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He said this in relation to the recent outcry by street vendors and hawkers in Nairobi who said they were being harassed by the City Inspectorate. So serious was the situation that three senior county officials—Security and Compliance Chief Officer Tony Kimani, Director of City Inspectorate Benjamin Omondi and Assistant Director, Operations, Carol Njuguna—were suspended by the County Head of Public Service on Wednesday evening. Their suspension letters said the people of Nairobi must be treated in a humane manner, with utmost care and dignity, and this had not been the case recently.
Voted for them
Mr Gachagua said the mama mbogas and the hawkers overwhelmingly voted for them and they would therefore not tolerate their mistreatment.
He also said he would be meeting with top county officials to find ways to create space for the hawkers and street vendors in the city.
“The hustlers are very important people and they should be given a chance to earn a living. When they come to the streets to sell their merchandise, they have no problem with anyone,” he said.
