M-KOPA, a debt financing platform for sustainable assets like solar power systems, has secured over $250 million in funding to support its expansion in Sub-Saharan Africa, the company announced.
Among the investors involved in this funding round are Standard Bank and Sumitomo Corporation, alongside these other participants:
- Blue Haven Initiative
- Broadscale Group
M-KOPA was established in 2011, and initially launched its services in Kenya, but has since expanded its operations to Uganda, Nigeria, and Ghana. Over the years, the company has made significant strides in providing financial access to underserved communities.
The company operates on a business model that involves providing loans to customers for the purchase of various products and services. Through its platform, M-KOPAoffers financing options for items like smartphones, solar power systems, and other consumer goods. Additionally, it provides loans and facilitates access to health insurance.
With a flexible credit model, the business allows individuals to pay a small deposit for the products above and pay off through micro-installments, helping build their credit history over time. Default rates are said to be just above 10%.
M-KOPA reports that it has assisted approximately 3 million customers in accessing more than $1 billion in credit. These funds have enabled customers to purchase various essential items such as smartphones, solar power systems, and health insurance.
According to M-KOPA, Standard Bank led and arranged $200 million in sustainability-linked debt financing, while Sumitomo had injected $36.5 million in new equity investment.
According to CEO, Jesse Moore, the funds will allow M-KOPA to double the size of its now 3 million-strong customer base in existing markets.
M-KOPA has also set its sights on expanding its range of financial services and product offerings as well as contributing to reducing greenhouse gas emissions in Kenya and Uganda.
The company also aims to close the gender gap in terms of those who receive its products as well as in its agent network.
“There’s a huge demand for life-enhancing products like smartphones and solar systems, which are difficult to afford, but we’ve made them affordable and accessible to our customers,” said Moore.
“Our next category in R&D right now is electric motorcycles. We’re very excited about electric mobility and we’re sure that in the next couple of decades, there will be a big switch in ownership where electric motorbikes will scale when there’s financing to go with them,” Moored added
Since its establishment in 2011, M-KOPA has successfully raised a total of $245 million in equity funding. In March 2022, the Kenyan-based fintech announced a funding round that raised $75 million in equity.
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