Grace Ashiru
About one-third of the people in Kenya need access to power. Even though solar energy is clean and reliable and can save homes and companies in Kenya money in the long run, many Kenyans can’t switch to it because the equipment costs a lot upfront
Sun King, a leading provider of solar energy solutions in Africa and Asia, has revealed a partnership with Citi to start a new kind of bank-led securitisation deal with only Kenyan Shillings as payment. The point? To make it easier for Kenyans to get money for off-grid solar projects
The $130 million project uses payments from Sun King’s current and future customers in Kenya to raise money for growth and development in the off-grid solar energy sector.
The securitisation arrangement lets investors pay for the expected future payments from more than a million Sun King customers. This gives investors access to a market that wasn’t being served before and gives them returns that are spread out across different risks.
Sun King designs, sells, installs, and finances solar energy systems for homes and companies in Africa and Asia. Through their “Easy Buy” plan, customers can buy solar products and pay for them over time with small payments as low as $0.15 per day.
Citi was the lead placement agent, and Standard Bank Group helped them set up the scalable loan product as a co-placement agent. The securitisation deal, part of Sun King’s Sustainable Financing Framework, is meant to speed up the adoption of clean and reliable energy solutions in Kenya, where about 30% of the population doesn’t have access to power.
