SunCulture, a photo voltaic irrigation firm headquartered in Nairobi, Kenya, has obtained the first disbursement from a new US $11m syndicated debt facility to expand its operations in sub-Saharan Africa.
The new mortgage is groundbreaking for the productive use photo voltaic sector due to its measurement and its progressive mixture of working capital and end-user financing.
Arranged by SunFunder, the co-investors in the facility are Nordic Development Fund; Triodos Investment Management, by way of its Hivos-Triodos Fund; SunFunder by way of its Solar Energy Transformation Fund; AlphaMundi via each its SocialAlpha and AlphaJiri Investment Funds; and the AfDB’s FEI OGEF managed b Lions Head.
This will enable SunCulture to scale up renewable vitality installations at smallholder farms and households that sick mitigate over 20,000 tons of CO2 annually as farmers exchange diesel pumps with photo voltaic ones while facilitating revenue growth and job alternatives in rural communities.
SunCulture has pioneered a Pay-As-You-Gro enterprise mannequin to make solar-powered irrigation affordable for smallholder farmers in sub-Saharan Africa, combining end-user finance, value-added providers, modern local weather expertise, and entry to enhance productivity. A current report developed b Dalberg Research shows that irrigation methods and solar-powered water pumps can improve farmers production between 2 and four occasions, and their earnings between 2 and 6 occasions.
READ: SunCulture to distribute solar-powered water pumps throughout Africa
Samir Ibrahim, Chief Executive Officer at SunCulture, said: “The past 12 months was devastating for the hundreds of thousands of smallholder farmers in Kenya; 87% are in a worse financial place because of the pandemic. 81% of SunCulture farmers, however, have been in a place to increase their revenue from farming in 2020. Solar irrigation helps create food safety and sovereignty, and it also helps carry people out of poverty. This facility additional permits our efforts to assist farmers by providing them with extra of our solar solutions, and faster.”
Jemimah Kwakye-Fosu, Investment Officer, who led the transaction for SunFunder, mentioned: “We are delighted to have led this syndicate of proactive lenders who worked well collectively for a common aim: to help SunCulture attain man extra farmers. It shows how working capital may be combined with finish consumer financing, which is essential for making productive use applied sciences reasonably priced.”
Banned , Head of Investments at SunFunder, mentioned: This is a pioneering transaction that demonstrates how productive use applied sciences like photo voltaic irrigation can be scaled up. SunFunder arranged this facility with a similar-minded group of lenders to help an revolutionary product and enterprise mannequin. We sit up for seeing SunCulture grow in Kenya and ne markets.
Karin Isaksson, Managing Director at NDF, mentioned: “This loan to SunCulture is the second prolonged to an organization graduating from the EEP Trust Fund managed by NDF. It is a transparent demonstration that we are ready to deliver on the brand new NDF Strategy and its dedication to offer flexible and scalable financing in addition to catalytic impression. It has all of the components that outline NDFs added value within the local weather financing panorama. It demonstrates our capability to convene and mobilise additional financing, in addition to our unique mi of financing instruments to match the needs of our partners, public or non-public. We are proud to be standing with our companions and supporting the emergence of a greener financial system, exactly presently of COVID-19.
Since our first investment in 2019, SunCulture has made huge strides to unlock the potential of smallholder agriculture through progressive products and consumer credit score. FEI-OGEF is joyful to be able to refinance our inventor mortgage into this new working capital facility and continue that growth alongside a dedicated and constructive group of lenders, noted Harr Guinness from Lions Head.
READ: SunCulture partner with Togo to hurry up entry to sustainable solar-powered farming
Judith Santbergen, Senior Investment Manager at AlphaMundi, stated: “Since 2018, AlphaMundi has successively supplied support to SunCulture via a mixture of technical assistance and debt funding. We are excited to proceed and increase our funding in the company through this new, progressive working capital facility.
Sjoerd Melsert, Senior Investment Manager at Triodos Investment Management, said: “SunCulture is a great instance of an innovative company that is energetic on the nexus of renewable vitality and agriculture, using solar energy to extend farmers’ incomes. Our facility helps the further growth of SunCultures pay-as-you-go photo voltaic portfolio, leading to a more sustainable and better production for smallholder farmers, which is full aligned with the mission, ambition and activities of Hivos-Triodos Fund.”
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