d.light, a provider of off-grid solar products and solutions, secured a $30 million securitization facility from Eastern and Southern African Trade and Development Bank Group (TDB Group), with the capability to purchase up to $125 million of receivable assets. This facility brings the company’s total potential securitized financing since 2020 to $490 million.
d.light will use the capital to increase its existing securitized financing facility in Tanzania and scale up its low-cost Pay-Go personal finance service in the country so that more low-income people and households can purchase the company’s solar-powered household products.
Nick Imudia, CEO of d.light, said, “d.light and our lending partners are long-time pioneers in developing securitized finance as an innovative, scalable financing model for raising equity for off-grid solar that is guaranteed against current and future customer sales. We’ve successfully used the securitization model for several years in Kenya , and now we and our partners are expanding it to Tanzania.”
d.light’s finance facility in Tanzania works by leveraging the payments of d.light’s existing and future customers there for solar products purchased using its Pay-Go service. This is then used to raise funding to upscale the company’s activities and grow market share in the country.
Michael Awori, CEO of TDB, said, “Access to energy is critical to the sustainable development of the continent, especially for the most vulnerable off-grid communities. As one of the leading renewable energy financiers in the region, we are delighted to extend this second facility to d.light, this time in Tanzania. Globally, in 2022 alone, the company reached over 1,677,216 people through Pay-Go model, created close to 2,000 jobs, and averted 1,329,371 tons of CO2 and black carbon emissions with solar replacing kerosene lamps. This is the kind of impactful track record TDB is keen to support.”
According to Mercom’s 1H and Q2 2023 Solar Funding and M&A Report, in 1H 2023, seven securitization deals totaled $1.9 billion, a 36% increase YoY compared to the $1.4 billion raised in five deals in 1H 2022.