M-KOPA Solar, a pay-as-you-go energy provider to off-grid homes, has secured a total of US$80 million of committed financing form Stanbic Bank, CDC, FMO and Norfund. The company, which has connected well over 500,000 homes in East Africa, to date, says it will be utilising the funds over the next three years to provide finance for pay-as-you-go solar installations in one million homes.
Stanbic Bank is leading the financing with a $55 million debt facility and has committed US$9 million. CDC gave $20 million, FMO gave $ 3 million and Norfund gave $13 million. The amount is in Kenya Shillings and Uganda Shillings and will be backed by customer receivables, paid over mobile money payment plans. It is the largest commercial debt facility to date in the pay-as-you-go off-grid energy sector.
M-KOPA has also secured $25 million in debt from responsAbility, Symbiotics, and Triodos Investment Management.
Chad Larson, Chief Credit Officer and Co-Founder, M-KOPA Solar, commented on the financing saying, “Stanbic’s team was innovative and flexible in its approach, which allowed the lenders to provide a large line of credit for our receivables. This record-breaking facility is being deployed primarily into off-grid households, with per capita income of less than US$2 per day. Over the past year, Stanbic and M-KOPA have worked collaboratively to design a facility that reliably funds M-KOPA’s growth in local currency, while providing considerable safeguards for the lending syndicate.”
Stephen Lovell, Head: Corporate Financing Solutions – East Africa, Stanbic, also commented, “We are excited to partner M-KOPA, the leader in pay-as-you-go off-grid power in Africa. Off-grid solutions are set to become a much bigger source of supply – as technology and funding mechanisms become more accessible. Through this innovative debt financing solution, which is the largest of its kind, the company is able to fund the next wave of pay-as-you-go installations across East Africa. We are proud to be a part of this landmark transaction and the positive impact it will have on lives and communities.”
M-KOPA has been named to MIT Technology Review’s list of the 50 Smartest Companies of 2017. It has been recognised as the pioneer of pay-as-you-go off-grid solar, as a winner of the 2015 Zayed Future Energy Prize and being selected by Fortune Magazine as one of the Top 50 Companies Changing the World.
