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M-KOPA to enter 1 million more homes
M-KOPA Solar, a pay-as-you-go energy provider to off-grid homes, is announcing that it has secured US$80 million of committed financing….
M-KOPA Solar, a pay-as-you-go energy provider to off-grid homes, is announcing that it has secured US$80 million of committed financing. The US$80 will be used over the next three years to provide finance for pay-as-you-go solar installations in one million homes – on top of the 500,000 already connected.
Stanbic Bank is leading a US$55 million local currency equivalent debt facility and has committed US$9 million. CDC (US$ 20 million), FMO (US$ 13 million) and Norfund (US$ 13 million) are part of the lending syndicate. It 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.
“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.” Stephen Lovell, Head: Corporate Financing Solutions – East Africa, Stanbic, said.
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“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.” Chad Larson, Chief Credit Officer and Co-Founder, M-KOPA Solar, said.
Jesse Moore, CEO and Co-Founder, M-KOPA Solar, commended CDC’s debt investment as it came on the back of the company leading M-KOPA’s series F equity raise last year. He also expressed delight in Stanbic, Norfund and FMO for investing, saying:
“This facility offers lenders the chance to connect low-income homes to power and information – while delivering sustainable returns. It’s part of an emerging trend for development partners and investors to look at more cost effective ways to fund last mile connectivity.” He said.
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M-KOPA has also secured US$25 million in US$ debt from responsAbility, Symbiotics, and Triodos Investment Management.
To date M-KOPA has connected well over 500,000 homes in East Africa to affordable, safe and clean energy. Its predominantly low-income customer base is accessing lighting, phone charging, radio and TV on daily mobile money payment plans that are less than the typical cost of kerosene.
M-KOPA customers now enjoy over 62.5 million hours of kerosene-free lighting per month and they will save over 600,000 tonnes of CO2 over four years. Customers who complete their payment plans are upgrading with M-KOPA for more lights, TVs, energy-efficient cooking stoves, smart phones and water tanks. The company has sold well over 160,000 upgrade units to date – including 90,000 Solar TVs.