Hustler Fund Launches Credit Rating System to Boost Loan Access and Flexibility
The Hustler Fund is set to provide bigger loans and improved financial access as the government introduces a behavioral credit rating system in its next phase. Announced by President William Ruto during the Fund’s second anniversary at the Kenyatta International Convention Centre (KICC), the initiative aims to enhance efficiency, transparency, and borrower empowerment.
Introducing the Behavioral Credit Rating System
The newly launched credit rating system evaluates all Hustler Fund borrowers, assigning them a score ranging from A1 (Very Good) to C3 (Very Poor) across nine bands: A1, A2, A3, B1, B2, B3, C1, C2, and C3. Borrowers with favorable repayment behavior, particularly those who repay their loans within the designated 14-day period, can achieve higher ratings and qualify for larger loan limits.
President Ruto emphasized that the system is fully automated and based solely on borrowing patterns, eliminating the need for external influence.
“You don’t have to know the chief, the Principal Secretary, or the President to get a good credit rating – all you need is your phone,” Ruto stated.
Launch of the Bridge Loan
The President also unveiled the Bridge Loan, a new product allowing Kenyans to access larger loans with extended repayment periods, transitioning successful borrowers into the mainstream financial sector. The repayment period has been increased from 14 days to 30 days, addressing borrower feedback for greater flexibility.
The interest rate remains competitive at 8% per annum, making the Hustler Fund a viable option for borrowers seeking financial stability.
Empowering Borrowers Through Financial Integration
President Ruto urged banks and financial institutions to incorporate Hustler Fund credit scores into their assessments of loan applicants. This initiative seeks to connect good borrowers with mainstream financial services, fostering long-term financial growth.
“Good borrowers will be able to triple their credit limits,” Ruto revealed, underscoring the system’s rewards for responsible borrowing.
Impact of the Hustler Fund Over Two Years
Since its inception, the Hustler Fund has significantly impacted Kenya’s financial landscape:
- Created credit profiles for 24.7 million Kenyans.
- Disbursed over Sh60 billion in personal loans.
- Saved Sh3.4 billion through mandatory savings, with 70% allocated to long-term savings and 30% to short-term savings.
The long-term savings will now be managed by the Kenya National Entrepreneurs Savings Trust, a government-backed pension scheme designed for Kenya’s informal sector.
By incorporating innovative credit rating systems and expanding loan options, the Hustler Fund continues to promote financial inclusion and empower millions of Kenyans in their journey toward economic stability.
