The first phase roll out of the Hustler Funds programme is expected to be launched on November 30.
This is after the cabinet approved the legal and institutional framework to anchor its establishment and implementation on Tuesday.
The Fund is expected to provide affordable credit facilities and boost a savings culture while creating momentum for sustainable development.
It has four products including Personal Finance, Micro Loans, SME Loans and Start Up.
The approval came during the second cabinet meeting on Tuesday, which was chaired by President William Ruto.
The leaders lauded the Central Bank of Kenya (CBK), Financial Intermediaries and Financial Institutions, and Mobile Network Operators for their support in steering the Fund's development.
Loan limits will be a minimum of Sh500 up to a maximum that will be determined by the borrower’s credit score and capped at Sh50,000.
As a first single digit credit product in the Country and the region, the cabinet said the loan interest rate will be capped at 8 per cent yearly and computed on a pro-rated basis.
The Cabinet has further approved the proposed launch of the Centre for Entrepreneurship.
The project is in a bid to create employment through the use of micro and small enterprises.
The Centre, which will be set up within Kenya Industrial Estates (KIE), will be established through a partnership between the Kenya and Germany.
It will target 250,000 youth entrepreneurs across the country, between ages 18 and 35 years.
The programme will provide them with information on brand campaigns, website and call-in to the centre.
Additionally, 100,000 youth entrepreneurs are expected to access in-depth screening services including coaching, mentoring and career guidance.
It is also expected to create over 50,000 direct and indirect jobs by expanding manufacturing output and improving the overall country’s competitiveness.
