SunCulture, a photo voltaic irrigation company headquartered in Nairobi, Kenya, has acquired the first disbursement from a new US $11m syndicated debt facility to broaden its operations in sub-Saharan Africa.
The new mortgage is groundbreaking for the productive use solar sector due to its measurement and its innovative mixture 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 by way of its Solar Energy Transformation Fund; AlphaMundi by way of both its SocialAlpha and AlphaJiri Investment Funds; and the AfDB’s FEI OGEF managed b Lions Head.
This will allow SunCulture to scale up renewable energy installations at smallholder farms and households that sick mitigate over 20,000 tons of CO2 yearly as farmers replace diesel pumps with solar ones whilst facilitating earnings growth and job opportunities in rural communities.
SunCulture has pioneered a Pay-As-You-Gro business mannequin to make solar-powered irrigation inexpensive for smallholder farmers in sub-Saharan Africa, combining end-user finance, value-added services, fashionable local weather know-how, and entry to improve productiveness. A recent report developed b Dalberg Research shows that irrigation techniques and solar-powered water pumps can increase farmers manufacturing between 2 and 4 times, and their income 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 millions of smallholder farmers in Kenya; 87% are in a worse financial place as a end result of pandemic. 81% of SunCulture farmers, nevertheless, have been in a position to increase their income from farming in 2020. Solar irrigation helps create meals security and sovereignty, and it additionally helps carry individuals out of poverty. This facility further enables our efforts to assist farmers by offering them with more of our photo voltaic solutions, and faster.”
Jemimah Kwakye-Fosu, Investment Officer, who led the transaction for SunFunder, stated: “We are delighted to have led this syndicate of proactive lenders who worked nicely together for a standard aim: to help SunCulture attain man extra farmers. It exhibits how working capital may be mixed with finish person financing, which is crucial for making productive use technologies affordable.”
diaphragm seal , 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 organized this facility with a similar-minded group of lenders to support an revolutionary product and enterprise mannequin. We look forward to seeing SunCulture grow in Kenya and ne markets.
Karin Isaksson, Managing Director at NDF, stated: “This loan to SunCulture is the second prolonged to a company graduating from the EEP Trust Fund managed by NDF. pressure gauge octa is a clear demonstration that we will deliver on the model new NDF Strategy and its commitment to provide flexible and scalable financing in addition to catalytic influence. It has all of the ingredients that outline NDFs added value in 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 wants of our partners, public or private. We are proud to be standing with our companions and supporting the emergence of a greener economic system, exactly at this time of COVID-19.
Since our first investment in 2019, SunCulture has made huge strides to unlock the potential of smallholder agriculture by way of progressive merchandise and consumer credit score. FEI-OGEF is happy 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 companion with Togo to speed up entry to sustainable solar-powered farming
Judith Santbergen, Senior Investment Manager at AlphaMundi, stated: “Since 2018, AlphaMundi has successively provided help to SunCulture via a mix of technical help and debt funding. We are excited to proceed and enhance our investment within the firm via this new, progressive working capital facility.
Sjoerd Melsert, Senior Investment Manager at Triodos Investment Management, mentioned: “SunCulture is a great example of an innovative firm that’s lively on the nexus of renewable power and agriculture, utilizing photo voltaic power to increase farmers’ incomes. Our facility supports the further growth of SunCultures pay-as-you-go photo voltaic portfolio, resulting in a extra sustainable and higher manufacturing for smallholder farmers, which is full aligned with the mission, ambition and actions of Hivos-Triodos Fund.”
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