Let Hustler Fund work for majority of poor Kenyans

The government needs to urgently revive the conversation on affordable loans. The availability of loan facilities that are easily accessible is key in a country that seeks prosperity for its people.

Luckily, the current Kenya Kwanza government was aware of this reality with the conversations giving birth to what is now the ‘Hustler Fund’.

The Hustler Fund was a beautiful initiative to respond to an unfortunate situation where Kenyans were at the mercy of shylocks and digital lending programmes with extremely high interest rates of upwards of 30 per cent, going up to 100 per cent for those who delay payment.

The Hustler Fund was to be a boon for Mama Mbogas and other small-scale traders who needed quick injection of cash for their daily stocking. When enhanced, it would have been an alternative to the expensive hire purchase products with which most boda boda operators acquired their motorbikes.

Now, a good number are poorer than they were as credit facilities chase after them due to reduced returns and thus their inability to pay.

Today, the buzz around the fund is gone. Chiefly because few Kenyans qualified for meaningful amounts that could propel them in their business or small-scale venture. Kenyans are still borrowing from commercial lenders and shylocks. The worst bit is commercial loans have also doubled in interest rates since the Kenya Kwanza government rode into power.

Unlike in the Kibaki and Uhuru regimes, where banks literally hawked loans, a number of policy adjustments in the current administration have now made banks start hawking saving products. You may have witnessed banks now offering to keep your money for interest as high as 14 per cent.

Even for a layman, it is obvious the banks have found a less risky way to invest their money through high-interest government bonds and securities rather than individuals. A few days ago, I tried to inquire about an unsecured loan, and the figures oscillated between 23 and 26 per cent.

So the current status favours those who already have money in which they can invest. The rich are bound to get richer, and the poor, poorer. However, current status is the perfect opportunity to reimagine the Hustler Fund. The Hustler Fund must now move beyond buttons and apps and have a real presence in villages across Kenya.

It should no longer compete in the same market with digital lending products and the famous ‘Fuliza’ but be a full-fledged empowerment programme in the likes of Grameen Bank in Bangladesh. For lack of time and space, I may not enumerate the impact the noble project that began in 1976 has had in villages in Bangladesh.

The Grameen Bank has got to the point where it loans beggars so they can stop begging. The Grameen Bank offers more than just loans. It offers scholarships to bright children of its members; all this is done by going to the doorsteps of the members and having its officers attend table banking meetings.

-The writer is anchor Radio Maisha