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HUSTLER FUND GROUP LOAN PRODUCT: WHAT YOU NEED TO KNOW

The Hustler Fund Group loan product is the new, innovative product under the Financial Inclusion Fund commonly known as the Hustler Fund. This a revolutionary and transformational Fund that aims to provide access to responsible finance and low interest rates for personal, micro, small, and medium-sized enterprises (MSMEs) in Kenya.

The group loan product targets groups registered by the Micro and Small Enterprises Authority (MSEA) such as chamas, associations and Saccos and aims to bridge the gap between these entrepreneurs and access to capital, and help fuel economic growth through collective-driven competitive market enterprise.

The Hustler Fund Group loan product allows groups to apply for loans ranging from Kes 20,000 to Kes 1 million. The interest rate is 7% per annum on reducing balance and 1.5% default rate. The repayment period is six months from the disbursement date.

Borrowers can opt to repay in instalments or lump sums. The loan also requires a saving of 5% of the approved amount, which is channeled towards the group members’ savings scheme. To be eligible for the loan, a group must have a minimum of ten members and must possess an active registration certificate from the Micro and Small Enterprises Authority (MSEA).

The Group loan product is easy and convenient to access. You only need to dial *254# across any mobile network or use a mobile app. You also need to be a Kenyan citizen, have a mobile money wallet, and be above 18 years to qualify. You do not need any collateral or guarantors. Your group’s credit score will be appraised through a credit scoring algorithm based on the collective individual members’ score, including but not limited to, their savings and repayment history on the Personal Loan Product.

The product is suitable for groups that engage in economic activities in the agriculture, trade, manufacturing, services, and technology sectors. The loan can help groups to expand their businesses, increase their incomes, create jobs, and improve their livelihoods.

The Hustler Fund Group loan product was launched by President William Ruto on June 1, 2023 during the Madaraka Day celebrations in Embu County. It is the second product of the Hustler Fund, following the success of the Hustler Fund Personal loan product that has disbursed close to Kes 30 billion to over 20 million Kenyans since its launch on 30th November 2022.

FREQUENTLY ASKED QUESTIONS (FAQS)

1.         What is Hustler Fund Microloan for groups?

This is the second product of the Hustler Fund targeting registered groups with affordable and digitally accessible loans to spur economic growth within the identified priority sectors thereby boosting the post pandemic economic recovery efforts by the Government of Kenya while driving the culture of savings.

2.         What kind of groups can use Hustler Fund Microloans for groups?

Any registered group with a minimum of 10 members engaged in common economic activity can opt into Hustler Fund Groups Microloans. The groups must possess activate registration certificate from the Micro and Small Enterprises Authority (MSEA). 

3.         Who can qualify for the Hustler Fund Microloan for groups?

Any group registered by Micro and Small Enterprises Authority (MSEA). The group must have a minimum membership of ten (10) people. Each member must possess a valid National ID (18 years of age and above) and have a registered mobile wallet with any of the three MNO networks (Airtel, Safaricom, Telkom) for more than 90 days. In addition, members of the group must not have defaulted on Hustler Fund Personal loan.

4.         What is MSEA?

MSEA is an abbreviated form for Micro and Small Enterprises Authority (MSEA). It is a government body established under the Micro and Small Enterprise Act No. 55 of 2012 mandated to formulate and Coordinate policies that will facilitate the integration and harmonization of various public and private sector initiatives, for the promotion, development, and regulation of the Micro and Small Enterprises.

5.         What services can I access on the Hustler Fund Microloan for groups?

When you dial *254# you’ll be able to access Hustler Fund Microloans for groups product. The services you can access or operations you can perform shall depend on whether you are a group official or a member. The service provided by this product include:

  • Group creation/registration
  • Members onboarding
  • Group loan request and disbursement
  • Group loan repayment
  • Funds Transfer to members (Payout)
  • Group official designation
  • Approval workflow by officials
  • Information Inquiries; Query Group Limit, Query Group Balance, Query Group Savings, Query Group Statement
  • Savings

6.         What are some of the operations that a group official can make on Hustler Fund Groups Microloans?

The services you can access or operations you can perform shall depend on whether you are a group official or a member. For example, a group member can query for group account or loan information, repay loan, receive funds from group, and join group. A group official shall be able to perform all group administrative functions like create group, invite members, approve requests, initiate role update for an official, initiate payout and request for loan. The official can also do every operation that a group member can.

7.         How do I register a group on Hustler Fund Groups Microloans?

You can access Hustler Fund Groups Microloans services on USSD channel. To create a group dial *254#, select Hustler Fund Microloans for groups and follow the prompt. Once you have created a group, you can invite members to join your group.

8.         Can my group have membership from different mobile operating network?

Yes, Hustler Fund Groups Microloans allow creation of group and onboarding of members from any network operator.

9.         Can I opt into multiple groups to access Hustler Fund Microloan?

No. Once you are opted into one group, you cannot join another group to access Hustler Fund Microloans for groups.  Similarly, you can access Hustler Fund with only one mobile number registered under your national ID regardless of the mobile network operator that registered you.

10.       What if an official requests and uses Hustler Fund Microloan without our knowledge?

When an official requests for Hustler Fund Microloan for groups, the other officials shall be alerted to approve or reject before the loan disbursement is done. In addition, the loan disbursement shall be done to the group account. All group members shall be notified of successful loan disbursement. To transfer funds from the group account to a member’s mobile wallet, another approval must be done by the officials (and any two members) before the transaction is processed.

11.       How can I request for a Hustler Fund Microloan for groups?

Only a group official can request for Hustler Fund Microloans on behalf of the group. This loan request shall be subjected to approvals from the other group officials (and two members). Once your group has been onboarded on Hustler Fund and assigned credit limit, a group official shall dial *254# and select Hustler Fund Microloans for groups to request for loan.

12.       Can we get Hustler Fund Microloan for groups if one member has defaulted on the other Hustler Fund loan products?

No. The member who has defaulted on the other Hustler Fund products must repay their debt in full for your group to get Hustler Fund Microloan.

13.       Why has our group received less money than what we requested from the Hustler Fund Microloan for groups?

After successfully requesting for Microloan for groups, 95% of the loan request shall be disbursed to your group account, and 5% shall be automatically channeled into your group savings account. 

14.       What are the charges for the Hustler Fund Microloan?

Any loan borrowed shall attract an interest fee of 7% per annum regardless of the loan repayment period. Overdue loan shall attract a penalty charge of 1.5% per year charged daily on the outstanding principal.

The interest is applied daily. Therefore, the earlier you repay the less the total interest you will pay.

15.       Can my group borrow more than once even before repaying the first Hustler Fund loan?

No, you can only have one outstanding group loan at any given time. You will have to repay your outstanding group loan before you can borrow again.

16.       If I am negatively listed on Credit Reference Bureau (CRB) can I still borrow a loan from Hustler Fund?

Yes. The Hustler Fund product does not check CRB to determine your eligibility to get a loan. This is part of the wider government initiative to offer all Kenyans negatively listed on CRB with an opportunity to repair their credit standing. However, we will check your loan performance on the Hustler Fund Personal Loan product.

17.       How can we increase our group credit limit on Hustler Fund Microloan for groups?

You can increase your group credit limit by borrowing and consistently repaying within the loan repayment period.

18.       What group operations or functions require approval?

Payout/withdraw or transfer of group funds, loan request, change of role shall require approval by officials (and two members) to initiated.

19.       Who can approve a request?

A group is made up of 3 officials: chair, treasurer, and secretary. All these officials shall be required to approve a request for it to be completed. If any of the official rejects an approval request, the entire transaction fails.

20.       Am I expected to repay after borrowing Hustler Fund Microloan for groups?

Yes. Your entire group including yourself is responsible for repaying any group outstanding loan within the loan repayment period from the date of borrowing.  This would enable you to grow your credit limit which would qualify you for higher loan amounts and future Hustler Fund loan products.

21.       How do we repay our outstanding Hustler Fund Microloan for groups?

Dial *254#, choose Hustler Fund Microloan for groups then select repayment and follow prompts to repay your group outstanding Hustler Fund loan. Anyone can repay, be it an official or a member.

22.       What will happen if we do not repay our Hustler Fund Microloan for groups?

If you do not repay your Hustler Fund loan within the repayment period, you will lose your group credit limit and your ability to borrow in future. The Government of Kenya shall institute any other necessary measures to recover the defaulted amount from all the group members.

23.       What is a group credit limit?

This is an e-value amount that is mapped to a group credit score and is used to determine the maximum amount of loan a group can borrow.

24.       What is available group credit limit?

This is a variable amount that shows the total amount a group can borrow at any given time. When a group borrows it reduces and when you repay it increases up to an amount equal to the group credit limit.  

25.       How can I check our group credit limit?

Dial *254# and select Hustler Fund Microloan for groups. Your group must be registered and activated on the Hustler Fund Microloan for groups to be able to query your group credit limit.

26.       Can we choose not to save when requesting Hustler Fund Microloan for groups?

No. After successfully requesting Hustler Fund Microloan, 5% of the loan request amount will automatically be channeled to your group savings account. 

To learn more about the Hustler Fund click here

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