PART I: HUSTLER MONEY IN KENYA

The Hustler Fund is a digital financial inclusion initiative designed to improve financial access to responsible finance for individuals, and micro, small, and medium-sized enterprises (MSMEs) in Kenya.

As much as the Hustler Fund is a political debt, it is said to be important because it gives people, micro, small, and medium-sized businesses (MSMEs) access to responsible financing. It does this by coming up with new services and products for the bottom of the pyramid that is affordable, easy to use, and right for the unserved and underserved. These include credit, savings, insurance, pensions, and investment products.

You can sign up for the Hustler Fund by dialling *254# or using the mobile app on any mobile network.

The Hustler Fund charges 8% per year, prorated, or 0.022% per day, for loans due in 14 days.

The interest on a 1,000-KES loan for 14 days is 3.07 KES. You’d spend 1,003.07 KES in that time.

A Mshwari Loan would cost 90 KES in fees, for a total of 1,090 KES owing 30 days after disbursement.

The requirement to borrow money is established by prior performance and credit ratings.

The Hustler Fund’s low-interest rate makes it desirable, but its 14-day repayment period may be too short.

When you take out a loan, you must save 5% of the total, 30% for the short term, and 70% for the long term (pension account). For example, use 1,000.

5% of 1000 = 50 KES. 70%, or 35 KES, will go to a pension account, and 30%, or 15 KES, to a savings account.

With an annual interest rate of 9% (higher than loan interest), saving under the programme seems like a good bargain, but it takes patience, especially with the 70% long-term requirement (which is applicable for both, ie. savings from the loan, or saving directly to the account)

The team hasn’t determined how to get the pension, such as by age and/or length.

The government pledges to double savers’ money up to $6,000 each year. Not bad, although it’s uncertain if this is in the middle at 30% or 70%.

If payment isn’t made within 14 days, the borrower’s credit score will plunge and the interest rate will climb to 9.5% per year; if payment is still overdue on day 30, their credit score will be wiped completely and their account will be blocked.

The Kenyan government, led by H.E. President Dr William Samoei Ruto, introduced the KES 50 Billion #HustlerFund, a digital financial inclusion initiative, 6 months into his tenure. His message to Kenyans was key to his victory. The President’s knowledge of the service, platform and products was excellent;

Dial *254#

No bureaucracy No committee, security, or assurance. A new system of behaviour collateral

2. 0.02%/8% 500x cheaper than the market (single-digit interest regime)

3. Loans 500–50,000

4. Micro-loan 50K-500K

5. Pension/Savings Match kes1 to kes2 to kes6000

Saccos and unregulated groups (chamas) will borrow up to KES 10 million.

Parliament is debating startup money for legislation.

The charge is for supporting the fund and has no return.

Despite all the scepticism, I thought the launch was a fantastic economic move.

How do you fairly divide money in a growing market?

#Kenya has two highlights. Mobile money and rapid credit have made money flow faster than before.

Nearly 15 million Kenyans were on a list of people who couldn't get digital loans and had to be taken off the CRB.

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