Former Mandera Senator Billow Kerrow has faulted President William Ruto’s administration’s plan for issuing loans to Kenyans under the Financial Inclusion Fund, popularly known as the Hustler Fund.
Instead, Kerrow says the loans should be grants if at all the Kenya Kwanza government is out to help boost millions of Small Medium Enterprises (SMEs) that are looking forward to benefitting from facility.
Speaking during an interview on Spice FM Monday, November 28, Kerrow stated that the main challenge in such a scheme is the uptake and accessibility to the loans.
He adds that most of those targeted will not meet the eligibility requirements that includes registration.
“The government should focus on the SMEs who form 80 percent of the job sector in Kenya. These are business people who cannot access loans from banks because of so many reasons. According to the Central Bank report in 2021, 20 percent of the total lending of all the banks went to SMEs which translates to around Sh30b to Sh40b.
Kerrow who also served as the Chair of the Senate Finance and Budget Committee, added that this is not the first time the government is issuing funds to Kenyans, warning that the modalities remain the same save for the brand names given to the loan schemes.
“In 2021, former President Uhuru Kenyatta launched another fund called Biashara Kenya Fund which was Sh2.5 billion. Earlier in 2020, he had launched another scheme, Credit Guarantee Scheme worth Sh12billion where the government was guaranteeing 25 percent of any lending to SMEs by banks. But the uptake was only Sh4billion in 3 years,” Kerrow said.
The financial expert equated the Hustler Fund to ‘a state-run fuliza’ stating that it is an irony that the Ruto led administration had promised to do away with predatory lending practices only to replicate the same under the Hustler Fund.
“Even if you give each person the maximum of Sh50,000, it is only 1 million Kenyans who will benefit from the kitty. Remember we have 7.5 million registered SMEs presently and you create and impression that the government is going to give people money to create jobs and then you talk of Sh50b?”, Kerrow paused.
The Hustler Fund, which was Kenya Kwanza’s key campaign promise, targets Kenyans aged 18 and above and businesses with a turnover of Sh100 million and below qualify for loan.