President William Ruto’s Hustler Fund has morphed once again as the Head of State continued to push banks to offer lending to small businesses on single-digit interest rates.
The President, while addressing a section of the small business owners, in a session organised by the Kenya National Chamber of Commerce and Industries (KNCCI), on Thursday made remarks to the effect that the Sh50 billion Fund may be interest-free.
However, he said small businesses will be charged a simple fee to access the money.
This fee was not specified.
These remarks have the President biting his tongue once again on the Hustler Fund that has been swinging from an interest fee financing, to single digit interest, to a saving platform and now an unspecified simple fee but without interest to access it.
President Ruto said the government will work with businesses on how to craft the Fund.
“I want to promise the country that the Hustler Fund is going to be on a single-digit interest rate. For the smaller enterprises, we will begin with just a simple fee, without interest; because we want to fire the bottom of the pyramid,” he said.
The highly publicised Fund is set to be launched on December 1, 2022. Through this fund, in partnership with the financial institution, the President anticipates to bring down the cost of borrowing for micro, small and medium enterprises.
Speaking at the event, the President reiterated this ambition saying it is time for a single digit interest rate to be levied on funding.
He added that agro-processing, value addition and manufacturing is a big components of how small businesses can move their product up the value chain.
“We cannot continue to sell unprocessed, semi-processed or poorly processed goods in our markets. We must up our game and must support businesses that venture into adding value to our products for local consumption and even for export,” the President said.
Trade, Investment and Industry Cabinet Secretary Moses Kuria said how the government plans to leverage on Kenya Industrial Estates (KIE) and Kenya Industrial Research and Development Institute (Kirdi) to equip small businesses with skills on value addition. He said some counties like Laikipia and Nyeri have offered land to set up common user facilities that small businesses can use.
“We are going to roll out these incubations to every county. That is the basis of our common user facility,” said Mr Kuria. “Our bottom is not organised. We have left our SMEs out there like mushrooms.”