Investors update: March 20 2023 - Mirova raises $171m for solar energy projects in Africa

Mirova raises $171m to finance solar energy projects in Africa

Highlights

• Mirova has announced that its solar energy-focused Gigaton Investment Vehicle has raised $171 million for its first closing.
• The blended finance debt strategy aims to accelerate the clean energy transition in underserved and emerging markets in developing countries, with a strong focus on sub-Saharan Africa.
• The funding will be invested in solar home systems, climate-smart food systems, energy efficiency, and carbon credit pre-financing, while aiming to offset CO2 emissions, create jobs, advance gender equality, and improve energy access for all.

Source: ABC

Our Takeaway

Today, more than 770 million people lack energy access in the world – mostly in Africa and developing Asia – regions with populations that are also the most vulnerable to the climate crisis. Addressing climate change requires a reallocation of capital to decarbonizing global economies, particularly a clean energy transition in emerging markets. The Mirova fund plans to accelerate the transition to a low-carbon economy and improve energy access in these regions. The fund’s target size is $500 million and it expects to deploy $1.2 billion of private debt throughout its life.

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South Africa’s Fin acquires Thuthukani to expand services

Highlights

• South African neobank Fin (formerly Finclusion Group) has acquired Thuthukani, a Pretoria-based fintech startup, as part of its expansion efforts.
• Through the acquisition, the latter’s incremental housing finance offering will be renamed to “Fin Home Loans” and integrated into Fin’s South African portfolio with a mandate to give middle to lower-income Fin customers access to affordable finance.
• Fin says it will continually identify partners in different sectors with this need, and as such, the Thuthukani acquisition is an extension of this strategy.

Source: TechCabal

Our Takeaway

Riding the wave of the growing influence of online banking, Africa-focused neobanks have been attracting a significant share of fintech investment. Since 2018, Fin, taking a cue from other credit-first neobanks, has built consumer-facing credit products to close the credit gap in the countries where it operates, including Tanzania, Namibia, South Africa, Eswatini, and Kenya. It has raised a total of $22 million over two funding rounds in 2022 to build Africa’s first credit-led neobank.

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OnePipe gets $4.8m from TLG to offer embedded finance services

Highlights

• Onepipe, a startup that powers digital financial services, has closed a $4.8 million credit line from pan-African investment firm, TLG Capital.
• Onepipe operates a suite of solutions, including embedded payment and reconciliation services. 
• The deal, which had been in the works since the third quarter of last year, will power the startup’s inventory finance solution for small businesses.

Source: Nairametrics

Our Takeaway

Across Africa, it reportedly takes an average of $500,000 and 18 months to build and go to market with financial products; companies need to go through the hurdles of rigorous licensing and compliance processes, multiple integration layers, complex banking, third-party relationships, etc. Platforms like Onepipe help reduce the time and financial costs of building through their API infrastructure. We believe this is the next phase of fintech innovation in Africa and should aid digital financial services in capturing the sizeable financial inclusion opportunity on the continent.