How Safaricom’s Hustler Fund is Helping Africa’s Financial Inclusion

Safaricom’s CEO, Peter Ndegwa has written about the launch of Hustler’s Fund and its impact on the African financial inclusion.

Peter Ndegwa, the Chief Executive Officer at Safaricom has written an article talking about Safaricom’s Hustler Fund and how they they intend to deepen the financial inclusion in Africa.

The launch of the Hustler Fund is a major boost in driving financial inclusion and empowering majority of Kenyans to access credit. The fund also heralds a new era by according all Kenyans an opportunity to contribute to their pension savings.

The Hustler Fund could not have come at a better time especially as small businesses bear the impact of prevailing tough economic conditions. There is no doubt on the need for credit across the country, however, access and the cost of credit are two key barriers to majority of MSMEs who needs funds to grow their businesses.

The ripple effect has been rising unemployment rates as companies struggle to meet the cost of inputs, while lower-income households have been hit by the high cost of food and household goods.

The commitment by the Govenrment to provide a financial solution that will enable millions of Kenyans to contribute towards nation building, is therefore a great way to situmulate both social and economic progress.

The masterstroke of the fund is perhaps its use of ICT. Technology is an essential driver of economic progress that benefits the country in totality.

The internet, which is mostly accessed via the mobile phone, has opened new revenue opportunities for entrepreneurs, thus enhancing their livelihoods. Businesses have also derived huge benefit from digital technology, enabling them to grow, create jobs and deliver more economic value.

There are many advantages that Mobile Network Operators (MNOs) offer when it comes to innovations and delivery of financial services such as the Hustler Fund.

At Safaricom, we know about the transformative power of the mobile phone, a tool for economic development, an enabler of innovation, and a foundation for modern day pioneering solutions. The mobile phone will continue to be a key highlight in innovation and development in this country, the continent and beyond.

As such, I was encouraged by the President’s recent comments that Kenya will manufacture the cheapest smartphone in Africa, adding that an affordable smartphone will ensure that Kenyans access digital platforms for economic empowerment and government services.

Single-handedly, the mobile phone has driven financial inclusion in Kenya, catapulting it from single digit at the turn of the century to over 85% now. Through mobile money, many individuals have been able to lift themselves out of poverty and contribute positively towards nation building. Currently only a third of Kenyans have 4G enabled devices. We must accelerate 4G device penetration to drive digital inclusion which is the super highway for access to social and economic empowerment.

Peter Ndegwa, Chief Executive Officer, Safaricom PLC

MNOs will provide the network and technology foundation needed to operationalise the Hustler Fund, with over 97% of the country’s population covered by 4G network. The fund will also be delivered entirely electronically on mobile money, via Hustler Fund mini-app available on M-PESA Super app or USSD *254#, with M-PESA, T-Kash and Airtel Money providing the platforms.

MNOs also offer direct access to a large customer base, including the harder-to-reach segments of the underbanked and unbanked. According to a Statista report, as of 2021, approximately 11% of Kenya’s adult population was financially excluded, with no access to bank accounts or banking services.

Adoption is also likely to be high due to MNOs offering benefits such as ease of use, as a majority of Kenyans are comfortable with, and have trust in mobile devices as a secure and simple transaction platform.

It is such partnerships that will spur the economy and deliver substantial benefit to our citizens. MNOs providing the network and platform, and Government providing credit that is accessible at affordable costs to all individuals and businesses.

Our role in making hustler fund a reality therefore, demonstrates our commitment to grow partnerships that help to unlock growth for Kenyans by combining complementary solutions between mobile operators and banks for the benefit of the public. ICT allows for agile to come alive and the agility of every partner including government and regulators made this a reality.

One of the biggest component of the Hustler Fund structure is that it’s not just a credit facility, but a savings vehicle too. The customer’s mobile money wallet will receive 95% of the requested funds, while the remaining 5% will be allocated to a savings plan. The 5% will be split between long-term and short-term savings. Of the 5% disbursed, 70% will be micro-pension with a government matching of 2:1 while 30% going into investments.

We look forward to mutual partnerships that will ensure we bridge the digital divide by providing solutions that will enable access to more affordable devices, because as we have witnessed, digital inclusion and connectivity are no longer a luxury; they are a necessity for economic development.

Peter Ndegwa, Chief Executive Officer, Safaricom PLC

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