By Mark Kawalya
M-KOPA has announced reaching a significant milestone in its fundraising drive after the firm secured more than $250 million in new debt and equity funding. The funding will enable the asset financing provider to expand the financial services it offers to the underbanked consumers that are spread out across sub-Saharan Africa, boosting the firm’s growth.
The financing round had a combination of more than $200 million for sustainability-linked debt financing, which was led by Standard Bank Group, Africa’s largest bank and a key strategic partner of M-KOPA.
Other significant funders that participated in the round were the International Finance Corporation (IFC), British International Investment, Nithio, Mirova SunFunder, and the Dutch Entrepreneurial Development Bank.
An additional $55 million in equity investment was secured from Sumitomo Corporation, an existing strategic investor, with a contribution of $36.5 million.
Aside from the funding, Sumitomo Corporation will also collaborate with M-KOPA to innovate new products and explore new growth markets. There was participation in the fundraising round by other notable organizations such as Lightrock, Blue Haven Initiative, Latitude and Broadsale Group.
M-KOPA runs a fintech platform that handles a combination of digital micropayments that make it possible for low income earners to own assets that are traditionally out of reach for them. The firm makes it possible for its clientele to make small financial deposits while taking ownership of products like electric motorcycles, solar power systems and smartphones.
So far, M-KOPA has sold more than 3 million products using a unique direct sales approach that involves a network of more than 10,000 agents.
The firm first established operations in East Africa before expanding to Nigeria in 2021 and recently to Ghana. The company has experienced a growth rate of 85% in new customer acquisition from 2020 to 2022.
This success was recognized by the Financial Times, which listed M-KOPA as one of Africa’s fastest growing top 100 companies for 2022 and 2023.
With this funding and a client base of more than 3 million, M-KOPA is anticipated to acquire an additional 1 million customers in 2023.