Hustler fund hit a 3 Billion default loan
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Hustler fund hit a 3 Billion default loan

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State-funded financial inclusion fund commonly known as Hustler fund hit a 3 Billion default loan in its 9th-month mark since launch.

Speaking to a local daily Moses Banda, the president’s adviser on matters of financial inclusion stated that over 33 Billion has been lent out to over 17.2 million users registered in the fund.

The outstanding Hustler Fund loan stands at 10.2 Billion, 29% is over 2.9 Billion and is said to be at risk since it has yet to be serviced by the borrower at the stipulated time to the lender making them fall into the category of non-functional loans.

This prompts Hustler Fund to have the highest defaults in comparison to commercial banks and microfinance institutions.

Despite this, Moses Banda assured the country that since the introduction of credit scoring for all borrowers the Hustler Fund loan has seen a great improvement, and just like all other lending organizations they’ll always face an issue of non-repayment.

In March 2023 the Ministry of Cooperatives revealed that the repayment rate was just over 61% with borrowers from counties in arid and semi-arid areas defaulting at more than 70%.

The Hustler fund was a campaign pledge by the president and he launched it in November 2022. It was established to help cushion and mitigate financial shocks.

Its main objection was to offer holistic financial solutions targeting people at the bottom of the pyramid and offer capital to members of the informal sector.

The fund received access to a funding pool of 50Billion giving loans of up to 50,000 and as low as 500.

Since its launch government has made strides to improve recoveries like setting affirmative laws that the loans be repaid within 14 days and failure will be forced to repay an interest of 9.5%, and if within 30 days it has also not been repaid they’ll be barred from accessing another until they clear their loans.

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