Hustler Fund defaulters may be blocked from renting houses and eventually accessing loans if a new proposal by the government is adopted.
According to the Acting Chief Executive Officer (C.E.O) of the Financial Inclusion Fund, Elizabeth Nkuku, the government is developing a credit score rating system which will be used to assess eligibility for home ownership.
Speaking during a media interview on Saturday, Nkuku stated that hustler loan defaulters may not be in a position to access future funding, including loans from select financial institutions.
“So one of the things we are going to do and we are going to roll it out is creating a score that can tell you, if you’re going to come and rent my house let me see your hustler fund score,” stated Nkuku.
It was further explained that the credit score rating system if successful, will be reliant on one’s track record and history in repaying borrowed funds. There are also plans to eventually do away with the requirement to have collateral while borrowing.
The credit score rating will be based on awarding points for those who repay their loans on time, consequently easing their access at acquiring loans.
Initially, the system will feature reviewing the hustler fund loan defaulters before proceeding to include other lenders.
“So eventually we shall grow this for a more comprehensive review so you are not looking at only the Hustler Fund, but how we shall include other people”, elaborated Nkuku.
Individuals who pay their loans on time will be able to use that as leverage to gain more loans and larger amounts in their future pursuits.
However, despite this new development, the government in its budget plan for the Financial Year 2024/2025 included a plan to disburse more funds to groups such as Boda Boda Rider Saccos and Mama Mboga groups.
According to government data, Ksh151 million has already been disbursed to over 50,000 active groups as was the vision when the government rolled out the Hustler Fund's group product.
Reports indicate that currently, the Hustler Fund, has a repayment rate of 73 per cent with the fund having disbursed Ksh40 billion to borrowers.
