Nairobi Senator Edwin Sifuna has encouraged Kenyans to take the Hustler Fund money launched by President William Ruto on Wednesday, November 30, 2022.
In an interview on Citizen TV on Thursday, December 1, the Nairobi Senator claimed that the Government had no legal recourse for Kenyans who did not pay back the money.
"This fund is not going to be sustainable. There's no intention for the people who are borrowing this money to pay it back. I encourage Kenyans to take the Hustler Fund money because there’s no legal recourse for the government to come after them because of not paying back. There's no mechanism for the government to recover this money," Sifuna stated.
President Ruto launched the Hustler Find on Wednesday saying it would benefit more the 15 million Kenyans.
The Head of State added that the facility would also liberate people from predatory lenders.
“We are establishing a culture of saving, investment, and social security,” he stated.
The repayment period for the Hustler Fund loans for small businesses has been capped at 14 days to enable them access cheaper credit. The fund will see minimum borrowers get Sh500 while the largest amount advanced will be Sh50,000 at an interest rate of eight percent.
With a 14-day repayment period and an annual interest rate of eight percent calculated per day, a customer who borrows Sh500 will pay back Sh501.53 after 14 days, representing Sh1.53 in interest.
Kenyans who will have not refunded the facility in 14 days get an extra 15 days to repay and if the loan is still not settled, the interest rate increases to 9.5 percent per year.
In the event a customer is not able to repay back the loan after the extension, the Hustler Fund account is frozen and the borrower loses all accumulated credit scores after more than 30 days of default.
There is also no CRB listing under the Hustler fund meaning the default has no impact on the debtor’s credit score with other lenders.