Ministry of Cooperatives and MSMEs Cabinet Secretary (CS) Wycliffe Oparanya has broken his silence over the Financial Inclusion Fund, popularly known as the Hustler Fund.
CS Oparanya revealed that the government has ramped up efforts to track a total of 19 million Hustler Fund loan defaulters.
The CS made the announcement on Friday, August 23, during the Kenya Private Sector Alliance (KEPSA) Annual SME Conference, awards and exhibition ceremony in Nairobi.
In his remarks, Oparanya highlighted that a total of 19 million people out of the 21 million who borrowed money in the first round defaulted and disappeared.
“This hustler fund was very innovative and digital but the problem we have had with Hustler Fund is that first round 21,000,000 people borrowed money. Out of the 21 million who borrowed, 19 million disappeared with the money,” he said.
CS Oparanya stressed that the funds are public money which must be repaid when borrowed, so that other people may benefit from it.
Oparanya on Hustler Fund defaulters
He warned that the government will be coming up with a system that will help in tracking down the defaulters in a bid to recover the funds.
“We are coming up with a system that will now track you, to know where you are. You will see someone knocking. Can you pay the Hustler Fund back for the benefit of others,” said Oparanya amidst laughter from the crowd.
“So, for those 19 million people, I am coming for you to make sure that you pay so that others can benefit even yourself you can benefit because if you borrow and don’t pay then you cannot borrow again, the system does not allow you to borrow again.”
Also Read: Govt Goes After Hustler Fund Defaulters in New Move to Recover Billions
On the other hand, the CS said that the government will be rewarding some of the 2 million people who have been borrowing regularly and paying back in time, adding that there is a Kenyan who is now borrowing up to two million and doing good business.
His remarks reflect on the government’s effort to recover billions of shillings in loans disbursed under the Hustler Fund which was launched in 2022 to support small businesses and individuals.
Defaulters Receive Notices
This initiative comes in response to a surge in loan defaults that threatens the fund’s sustainability.
Also Read: Hustler Fund Feted for Changing Lives of Kenyans
Borrowers who have defaulted for over a year are started receiving notices to repay their loans or face penalties back in June as the state aimed at reducing the size of the unpaid loans, which stood at Ksh9.9 billion as of October last year.
The Hustler Fund provides loans to individuals for a tenure of 14 days at an interest rate of 8% per annum.
Despite the fund’s noble intentions, the high default rate, recorded at 27% by the National Treasury last year, poses a significant challenge. This default rate is the primary obstacle undermining the fund’s viability.
How to repay Hustler Fund Loan
To repay your hustler fund follow these steps.
1. On your mobile phone’s dial pad, type *254#.
2. Select Hustler Fund then choose option 2 (Repay Loan).
3. Select whether you want to repay the full or partial amount (Option 1 or 2).
4. If you choose to repay the full amount, confirm and enter your M-PESA pin to repay with M-PESA.
5. If you choose to repay a partial amount, enter the amount to pay and enter your M- PESA pin and send.
Once the transaction is through you will receive messages from both M-PESA and Hustler Fund.
Repay your loan on time to increase your chances of limit increase.
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