d.light, a global provider of affordable household products and finance for low-income households, has secured a $30 million securitization facility from the Eastern and Southern African Trade and Development Bank Group (TDB Group). This funding brings about the potential to acquire up to $125 million of receivable assets as d.light continues its mission to improve access to energy across sub-Saharan Africa.
The financial boost will be utilized by d.light to expand its existing securitized financing program in Tanzania and to amplify its low-cost Pay-Go personal finance service. This aims to enable more low-income individuals and households in Tanzania to purchase d.light’s cost-effective solar-powered household products.
The CEO of d.light, Nick Imudia, emphasized that this financing from TDB allows them to extend their reach to more low-income families and households in Tanzania through their Pay-Go business model. Securitized finance has been a successful financing model for off-grid solar equity, which aligns with the company’s efforts to contribute to the United Nations’ Sustainable Development Goals for energy access. d.light has previously utilized this approach in Kenya and is now expanding it to Tanzania, with plans for further expansion into other sub-Saharan African markets in 2023.
This recent funding brings d.light’s total securitized financing since 2020 to $490 million. The Tanzanian financing initiative will be anchored by TDB. Michael Awori, CEO of TDB, highlighted the importance of energy access for sustainable development, especially in off-grid communities, and expressed the bank’s commitment to supporting d.light’s impactful initiatives.
With a population of over 64 million people, Tanzania is the fifth most populous country in Africa. The country faces significant challenges in electricity access, with only 40% of the population having reliable power supply. d.light has been operating in Tanzania since 2008, with a strong presence and contribution to the region. The company’s financing approach leverages customer payments for solar products purchased through the Pay-Go service, thereby raising funds to expand its activities and market presence in Tanzania.
d.light’s distribution network extends to remote areas, enabling access to safe, reliable, and affordable solar-powered products. The recent achievement of impacting over 150 million lives globally with its solar-powered household products demonstrates d.light’s dedication to improving access to clean energy and enhancing financial inclusion.
Through the securitization facility, d.light and its lending partner, African Frontier Capital (AFC), are establishing a new financing vehicle called Brighter Life Tanzania 1 Limited (BLT1). This vehicle aims to facilitate financial inclusion and promote clean energy access, contributing to a just and equitable energy transition. The collaboration between d.light and TDB Group signifies a significant step towards advancing energy access and improving the quality of life for low-income households in Tanzania and beyond.