SunCulture, a solar irrigation firm headquartered in Nairobi, Kenya, has acquired the first disbursement from a new US $11m syndicated debt facility to increase its operations in sub-Saharan Africa.
The new loan is groundbreaking for the productive use solar sector as a result of its size and its revolutionary 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 through 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 enable SunCulture to scale up renewable energy installations at smallholder farms and households that sick mitigate over 20,000 tons of CO2 annually as farmers substitute diesel pumps with photo voltaic ones whilst facilitating earnings progress and job alternatives in rural communities.
SunCulture has pioneered a Pay-As-You-Gro business mannequin to make solar-powered irrigation affordable for smallholder farmers in sub-Saharan Africa, combining end-user finance, value-added providers, fashionable local weather know-how, and access to enhance productiveness. A latest report developed b Dalberg Research reveals that irrigation methods and solar-powered water pumps can enhance farmers production between 2 and four times, and their earnings between 2 and 6 occasions.
Secret : SunCulture to distribute solar-powered water pumps throughout Africa
Samir Ibrahim, Chief Executive Officer at SunCulture, stated: “The previous 12 months was devastating for the hundreds of thousands of smallholder farmers in Kenya; 87% are in a worse monetary position because of the pandemic. 81% of SunCulture farmers, nevertheless, have been capable of enhance their income from farming in 2020. Solar irrigation helps create meals safety and sovereignty, and it also helps lift people out of poverty. This facility further permits our efforts to support farmers by offering them with extra of our solar options, and quicker.”
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 nicely together for a common aim: to help SunCulture attain man more farmers. It reveals how working capital may be mixed with end user financing, which is crucial for making productive use applied sciences reasonably priced.”
Surabhi Mathur Visser, Head of Investments at SunFunder, said: This is a pioneering transaction that demonstrates how productive use technologies like solar irrigation may be scaled up. SunFunder arranged this facility with a similar-minded group of lenders to help an progressive product and business model. We look ahead to seeing SunCulture grow in Kenya and ne markets.
Karin Isaksson, Managing Director at NDF, said: “This mortgage to SunCulture is the second prolonged to a company graduating from the EEP Trust Fund managed by NDF. It is a clear demonstration that we will ship on the new NDF Strategy and its commitment to supply flexible and scalable financing in addition to catalytic impression. It has all the ingredients that outline NDFs added worth within the local weather financing panorama. It demonstrates our capability to convene and mobilise additional financing, as well as our unique mi of financing devices to match the wants of our companions, public or non-public. We are proud to be standing with our companions and supporting the emergence of a greener economic system, exactly presently of COVID-19.
Since our first funding in 2019, SunCulture has made huge strides to unlock the potential of smallholder agriculture through innovative merchandise and consumer credit. FEI-OGEF is joyful to have the power to refinance our inventor mortgage into this new working capital facility and proceed that progress alongside a committed and constructive group of lenders, noted Harr Guinness from Lions Head.
READ: SunCulture associate with Togo to hurry up access to sustainable solar-powered farming
Judith Santbergen, Senior Investment Manager at AlphaMundi, said: “Since 2018, AlphaMundi has successively supplied support to SunCulture through a combination of technical help and debt funding. We are excited to continue and enhance our funding 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 revolutionary firm that’s lively on the nexus of renewable power and agriculture, utilizing solar power to extend farmers’ incomes. Our facility helps the additional growth of SunCultures pay-as-you-go photo voltaic portfolio, resulting in a extra sustainable and higher production for smallholder farmers, which is full aligned with the mission, ambition and activities of Hivos-Triodos Fund.”
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