Africa’s off-grid solar sector courts mainstream investors with landmark financing deals
Summary
Two major African off-grid solar companies, d.light and Sun King, have secured large financing deals using innovative methods to raise money from private investors. These deals aim to fund solar power systems for homes without reliable electricity by allowing customers to pay in small amounts over time, with future payments used to attract investment.Key Facts
- D.light issued a $50 million green bond in June 2026 to support affordable solar energy.
- Sun King raised $286 million in securitized debt in mid-2025, bundling future customer payments to attract investors.
- Both companies use a pay-as-you-go model where customers pay for solar systems in small, regular payments, often via mobile phones.
- These financing deals could attract mainstream investors beyond traditional donor or development agencies.
- Securitization means selling future payments as financial products to get cash upfront, but it is complex and costly.
- Larger solar firms benefit from securitization, while smaller firms find it less economical due to high fixed costs.
- Investors want 5-7 years of repayment data to feel confident in such financing deals.
- The sector faces risks like customers not paying as expected, which investors call portfolio quality risk.
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