- AGF and CBK to provide $7.5 for solar energy SMEs.
- Kenya targets universal energy access next year.
- Declining costs of solar have made it a more feasible option for connecting remote communities.
The African Guarantee Fund (AGF) has signed a loan portfolio guarantee agreement with the Co-operative Bank of Kenya (CBK) for $7.5 million. Under the guarantee facility, the CBK will finance green small and medium-sized enterprises (SMEs) especially solar energy providers. Franck Adjagba, AGF’s Director of Business Development, notes that “Banks in Kenya urgently need risk mitigation instruments to support their SME lending activities (…) Our partnership with the Co-operative bank today reflects our commitment to increasing financing for green businesses.”
Kenya aims to achieve universal energy access by the end of next year. The electrification rate in the country is already at 75 per cent. However, the government sees decentralised solar services as an option for rural communities too remote to be connected to the grid. The AGF and CBK believe that the new financing facility will enable the country to reach its electrification targets.