Thread by @money254HQ

Happening Now: Hustler Fund Launch at the Green Park Terminus in Nairobi. The fund, a core campaign promise of the Kenya Kwanza administration has a seed capital of Ksh50 billion

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#HustlerFundLaunch

The hustler fund is structured into four loan products.
1. Personal Finance
2. Micro Loans
3. SME Loans
4. Startup Loans

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#HustlerFundLaunch

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The Personal Finance Hustler Fund product - which is what is being launched today - will have a minimum loan limit of Ksh500 and a maximum of Ksh50k.

The actual amount you qualify for will depend on your credit history.

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On Interest rate, the Personal Finance product will be capped at 8% p.a. computed on a pro-rated basis.

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#HustlerFundLaunch

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The repayment period for the Hustler Fund, also known as the Financial Inclusion Fund will be 14 days.

This means that at 8% p.a. pro-rated, the interested rate for a 14-day loan will be 0.3%. This is yet to be expressly confirmed.

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The Hustler Fund has a mandatory savings element. For every loan disbursed, the govt will deduct 5% and place in the borrower's savings account.

This will be split into two:
1. 30% for short-term savings
2. 70 per cent for long-term (pension) savings.

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Kenyans can access the Hustler Fund through a USSD code and mobile app platforms offered by mobile network providers such as Safaricom, Airtel, and Telkom.

The USSD Code is expected to be made public at today's launch.

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#HustlerFundLaunch

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Hustler Fund borrowers will not need collateral, guarantors or file any paperwork since the application and disbursement will be through digital means.

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Hustler Fund Eligibility:
- Kenyans above 18 years
- MSMEs (business turnover must be below Ksh100M)
- Sacco Societies
- Chamas
- Groups
- Registered Table banking groups

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On Tuesday, November 29, it was revealed that financial intermediaries can apply for on-lending to individuals and small businesses. For example, Twiga Foods is set to receive Ksh300M from the Fund for on-lending.

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What Happens if You Default on the Hustler Fund?
a) Your credit rating is affected
b) You are given 15 more days after which interest rises to 9.5% a year
c) After more than 30 days of default, you lose all the credit scores accumulated and account is frozen

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There is no CRB listing for Hustler Fund defaults. Govt says this default does not affect the person’s credit rating with other creditors.

The defaulter can repay the loan at once or in instalments and begin borrowing again after full repayment.

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Banks are already eyeing dividends from what is set to become a 'foolproof credit scoring system' by onboarding customers who successfully repay the #HustlerFund loan.

Equity Bank says it is considering setting aside up to Ksh250B for this purpose.

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