What is a Hustler Group?
A Hustler Group is a collective of individuals who unite to access loans from the Financial Inclusion Fund, widely known as the Hustler Fund.
Initially, the Hustler Fund offered only the Personal Loan Product (PLP) for individual borrowers. However, on June 1, 2023, during the Madaraka Day celebrations in Embu County, President William Ruto unveiled the Hustler Fund Group Loan Product to cater specifically to Hustler Groups.
“The second product of the Hustler Fund will usher our unique collective-driven competitive market enterprise to the online domain. To promote inclusion, the Hustler Fund will support groups such as chamas and saccos, helping to overcome barriers to credit, savings, social security, health insurance, and other socioeconomic amenities,” said President Ruto.
He further remarked:
“I am glad that this launch of the group loan product is taking place against the backdrop of the phenomenal success of the Hustler Fund Personal Loan product. I expect this product to generate even greater interest in the market.”
How Do Hustler Groups Work?
The Hustler Fund Group Loan is designed to help formally recognized groups in Kenya finance their businesses and meet financial needs. The government introduced Hustler Groups to address the challenges entrepreneurs and small business owners face in securing capital for growth and expansion.
Benefits:
One of the primary advantages of Hustler Group Loans is the provision of much-needed capital to fuel business growth and enable economic empowerment in priority sectors like agriculture.
Eligibility Requirements
To qualify for a Hustler Fund Group Loan, groups must meet the following criteria:
- Membership Requirements:
- Group members must be Kenyan citizens aged 18 years or older.
- Each group must have a minimum of 10 members.
- All members must possess valid National Identification Cards (IDs).
- Mobile and Wallet Requirements:
- Each member should have an active SIM card (registered for at least 90 days).
- Members must have a registered mobile wallet (with Airtel, Safaricom, or Telkom) active for over 90 days.
- Verification:
- Groups must be verified by relevant government institutions, such as the Micro and Small Enterprises Authority (MSEA), Social Services, or the Business Registration Service (BRS).
- Loan History and Activities:
- Members should not have defaulted on any Hustler Fund Personal Loan.
- The group must be engaged in an economic activity within priority sectors of the Kenyan economy.
Key Features of the Hustler Fund Group Loan
| Feature | Details |
|---|---|
| Loan Amount | Ksh20,000 (minimum) – Ksh1 million (maximum) |
| Loan Tenure | Maximum of 6 months |
| Security | Group guarantee; no collateral required |
| Processing Fee | None |
| Interest Rate | 7% per annum |
How to Apply for a Hustler Fund Group Loan
To apply, follow these steps:
- Dial
*254#on your mobile phone. - Navigate to the Hustler Groups section.
- Create a group and add members.
- Follow the prompts to complete your loan application.
Only authorized group officials, such as the secretary or treasurer, can request a loan on behalf of the group. Loan requests are subject to approval by other officials and at least two regular members.
Loan Disbursement and Repayment
- Disbursement:
- 95% of the approved loan amount is sent to the group account.
- 5% is automatically allocated to the group’s savings account.
- Fund Distribution:
- Funds are disbursed to the official who applied on behalf of the group.
- To transfer money to individual members’ mobile wallets, group officials and two members must approve the transaction.
- Repayment:
- The group collectively repays the loan within the specified repayment period to maintain eligibility for future loans.
- Late payments incur a penalty of 1.5% per year, charged daily on the outstanding balance.
“Overdue loans will attract penalties, but prompt repayment grows your credit limit and opens access to higher loan amounts and additional Hustler Fund products,” explained Susan Mang’eni, Principal Secretary in the State Department of Micro, Small, and Medium Enterprises Development.
