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Ignore fake ‘Citizen TV’ graphic claiming defaulters on major Kenyan fund will have their mobile money wallets targeted

IN SHORT: As default rates on the government’s low-interest “hustler fund” scheme rise, claims are circulating that the money is to be recovered through M-Pesa debits. This is not true.

Debts owed to a government-backed scheme will be drawn from Kenyan users’ mobile money wallets, according to a graphic on Facebook.

The graphic, dated 2 February 2024, reads: “Hustler Fund debts to be deducted directly from M-pesa as from Saturday.”

The “hustler fund” was launched in 2022 as a government-backed KSh50 billion (about US$409 million at the time) scheme. It aimed to provide cheap loans, including to small businesses, at an annual interest rate of 8%. 

The fund was one of Kenyan president William Ruto's campaign promises ahead of the August 2022 elections – although it was supposed to be completely interest-free.

M-Pesa is a mobile phone-based money transfer, payment and microfinance service. It was launched in 2007 by mobile phone network operators, Vodafone and Safaricom.

The graphic features a photo of Kenya’s interior minister Kithure Kindiki and attributes the quote to him. It also incorporates the logo and branding of Citizen Digital, the online platform of Kenya's largest broadcaster.

In July 2023, Ruto said those who had defaulted on their individual loans would not be able to access the fund's second product, group loans.

By December 2023, 11 months after its launch, the value of the fund's loan defaults was close to KSh10 billion ($62.3 million).

According to the fund’s website, interest rates are adjusted to 9.5% per annum 15 days after the date of default. Thereafter, persistent defaults of 30 days or more will result in the borrower losing their existing credit score and having their account frozen. The interest rate will continue to accrue according to the in-duplum rule and debt collection procedures will be initiated.

The in-duplum rule states that interest and fees charged on a debt cannot exceed the original principal amount of the debt. It aims to protect borrowers from accumulating excessive debt through interest and other charges. 

So, is the graphic legit? We checked.


Ignore fake graphic

Citizen TV is one of the mainstream channels and is considered a credible source of news. If the claim were true, many defaulters would avoid making transactions on M-Pesa, a major trading platform in the country.

On 2 February 2024, the broadcaster, through its official Facebook account, marked the graphic as “FAKE”.

“Another day, another fake poster. Kindly disregard this message purporting to be from us. Thank You,” wrote Citizen TV Kenya.

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