SunCulture, a photo voltaic irrigation company headquartered in Nairobi, Kenya, has received the first disbursement from a model new US $11m syndicated debt facility to broaden its operations in sub-Saharan Africa.
The new loan is groundbreaking for the productive use photo voltaic sector as a end result of its measurement and its innovative combination of working capital and end-user financing.
Arranged by SunFunder, the co-investors within the facility are Nordic Development Fund; Triodos Investment Management, via its Hivos-Triodos Fund; SunFunder via 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 unwell mitigate over 20,000 tons of CO2 annually as farmers replace diesel pumps with solar ones whilst facilitating revenue growth and job opportunities in rural communities.
SunCulture has pioneered a Pay-As-You-Gro enterprise mannequin to make solar-powered irrigation reasonably priced for smallholder farmers in sub-Saharan Africa, combining end-user finance, value-added services, modern local weather expertise, and entry to enhance productivity. A latest report developed b Dalberg Research reveals that irrigation methods and solar-powered water pumps can improve farmers manufacturing between 2 and four times, and their revenue between 2 and 6 instances.
READ: SunCulture to distribute solar-powered water pumps across Africa
Samir Ibrahim, Chief Executive Officer at SunCulture, stated: “The past yr was devastating for the millions of smallholder farmers in Kenya; 87% are in a worse monetary place due to the pandemic. 81% of SunCulture farmers, nonetheless, had been in a place to enhance their revenue from farming in 2020. Solar irrigation helps create meals safety and sovereignty, and it also helps carry people out of poverty. This facility further enables our efforts to support farmers by offering them with extra of our solar solutions, and faster.”
Jemimah Kwakye-Fosu, Investment Officer, who led the transaction for SunFunder, said: “We are delighted to have led this syndicate of proactive lenders who labored well collectively for a standard aim: to help SunCulture reach man more farmers. It shows how working capital may be combined with finish user financing, which is essential for making productive use technologies inexpensive.”
Off-limits , Head of Investments at SunFunder, stated: This is a pioneering transaction that demonstrates how productive use applied sciences like solar irrigation may be scaled up. SunFunder arranged this facility with a similar-minded group of lenders to assist an revolutionary product and enterprise mannequin. We sit up for seeing SunCulture develop in Kenya and ne markets.
Karin Isaksson, Managing Director at NDF, mentioned: “This loan to SunCulture is the second extended to a company graduating from the EEP Trust Fund managed by NDF. It is a clear demonstration that we can ship on the model new NDF Strategy and its dedication to provide versatile and scalable financing in addition to catalytic impact. It has all of the components that define NDFs added value in the climate financing landscape. It demonstrates our capability to convene and mobilise additional financing, in addition to our distinctive mi of financing devices to match the wants of our companions, public or private. We are proud to be standing with our companions and supporting the emergence of a greener financial system, exactly right now of COVID-19.
Since our first funding in 2019, SunCulture has made large strides to unlock the potential of smallholder agriculture through progressive merchandise and client credit score. FEI-OGEF is pleased to have the ability to refinance our inventor loan into this new working capital facility and continue that growth alongside a committed and constructive group of lenders, famous Harr Guinness from Lions Head.
READ: SunCulture partner with Togo to speed up access to sustainable solar-powered farming
Judith Santbergen, Senior Investment Manager at AlphaMundi, said: “Since 2018, AlphaMundi has successively offered support to SunCulture by way of a mix of technical help and debt funding. We are excited to continue and increase our funding within the company via this new, innovative working capital facility.
Sjoerd Melsert, Senior Investment Manager at Triodos Investment Management, mentioned: “SunCulture is a superb example of an revolutionary company that’s energetic on the nexus of renewable energy and agriculture, using photo voltaic vitality to extend farmers’ incomes. Our facility helps the further progress of SunCultures pay-as-you-go solar portfolio, leading to a more sustainable and better production for smallholder farmers, which is full aligned with the mission, ambition and actions of Hivos-Triodos Fund.”
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