Cooperatives and MSMEs Cabinet Secretary Wycliffe Oparanya has announced that approximately Ksh.70 billion has been disbursed through the Hustler Fund since its launch in November 2022. The fund aims to provide credit to Kenyans previously excluded due to blacklisting by credit rating agencies, offering loans between Ksh.500 and Ksh.50,000 at an 8% pro-rated interest rate. Oparanya shared these details during a parliamentary session, noting that the fund has reached over 25 million Kenyans, with women comprising 48% of the borrowers.

President William Ruto announced a 'loan bridge' during the fund's second-anniversary, which targets borrowers with good credit history, potentially increasing their credit limits up to Ksh.150,000. Oparanya mentioned that two million borrowers have been promoted to this bridging band. The Hustler Fund allocates 5% of each loan towards savings, split between long-term (70%) and short-term (30%) savings.

However, the Hustler Fund faces challenges, including limited funding and borrower defaults. Oparanya stated that the MSMEs State Department requires Ksh.25,997,000,000 in the upcoming fiscal year but has been allocated only Ksh.6,353,300,000, resulting in a significant deficit. Additional funds are needed for credit disbursement and recurrent expenditure.

In related news, CS Wycliffe Oparanya urged Hustler Fund defaulters to honor their loan agreements during a meeting with the National Assembly's Committee on Trade, Cooperatives and Industry. Despite previously criticizing the Kenya Kwanza government, Oparanya now emphasizes the fund's benefits. He also revealed ongoing efforts to recover outstanding loans to allow more Kenyans to benefit.

Oparanya highlighted that two million out of the initial 20 million borrowers have demonstrated responsible borrowing habits, leading to the introduction of bridging loans with higher limits. He also discussed the potential of the Hustler Fund supporting cooperatives, contingent upon the passage of a provision in the Cooperative Bill 2024. Currently, directly channeling funds to cooperatives in the digital format is challenging, but a development fund could provide a framework for support.

The Kenya Kwanza administration positioned the Hustler Fund as a key initiative to support local citizens, offering financial relief to those previously excluded from credit. The fund allows borrowing from Sh500 to Sh. 50,000 with an 8 percent interest rate.