Provider of household products and affordable finance for low-income households, d.light, has secured a new $176 million (Sh22.9 billion) facility to expand its operations in Kenya, Tanzania, and Uganda. The financing, provided by African Frontier Capital, will bolster d.light’s PayGo consumer finance offering, making solar-powered products more accessible to households without electricity. This development is a significant step in the company’s mission to deliver affordable, clean energy solutions across East Africa.
The pay-as-you-go model has revolutionized the energy sector in East Africa, allowing low-income rural households to rent and eventually own home solar power systems. This innovative model removes the upfront cost barrier, making solar energy accessible to millions who previously had no access to reliable electricity. The new multi-currency facility aims to provide renewable energy to approximately six million people across the three countries over the next three years, enhancing d.light’s capacity to meet the growing demand for sustainable energy solutions.
With this new funding, d.light has now secured a total of $718 million (Sh93.5 billion) across five facilities since 2020. This substantial investment underscores the confidence that investors have in d.light’s business model and its potential to drive significant impact in the region. d.light’s CEO, Nedjip Tozun, highlighted that this facility represents the first time d.light has secured receivables-based financing in all its PayGo markets. This strategic move ensures consistent cash flow and eliminates the need for further external equity fundraising, enhancing the company’s financial stability and growth prospects. “Facilities like this make possible our pioneering PayGo consumer financing model with which we are able to offer solar home systems and high-efficiency appliances to the people that need them most in a way that is affordable and sustainable,” said Tozun.
d.light has been active in sub-Saharan Africa since 2010, with operations in Kenya, Uganda, and Tanzania. The company’s track record includes the successful repayment of its Brighter Life Kenya 1 Limited facility’s senior debt ahead of schedule earlier this year, a first in the off-grid solar sector. This achievement underscores d.light’s commitment to financial sustainability and its innovative approach to delivering clean energy solutions. Eric De Moudt, CEO of African Frontier Capital, praised the milestone, emphasizing the transformative role of financial innovation in promoting clean energy and financial inclusion for vulnerable communities. “This milestone is a testament to how data-driven financial innovation can play an important role in bringing financial inclusion to the world’s most vulnerable communities,” said De Moudt.
Over the past years, d.light has utilized securitized finance to support its solar-powered household products in sub-Saharan Africa. The company has established four facilities since 2020, including two in Kenya and one each in Nigeria and Tanzania. The combined purchasing value of these existing facilities, alongside the new facility, amounts to $718 million (Sh93.5 billion). This extensive financial backing reinforces d.light’s ability to scale its operations and extend its reach across the region.
In February, d.light announced that its $110 million (Sh14.2 billion) securitization facility, Brighter Life Kenya 1 Limited (BLK1), had successfully repaid its entire senior debt in full and ahead of schedule from internally generated cash flows. This landmark achievement marks the first instance in the off-grid solar sector where such a repayment was made, highlighting d.light’s robust business model and operational efficiency. This success not only reinforces d.light’s leadership in the off-grid solar market but also sets a precedent for sustainable financial practices in the sector.
