- Green Rising
- Posts
- Commercial banks tiptoe into Africa’s green economy
Commercial banks tiptoe into Africa’s green economy
If capitalism is the solution for climate, then banks are key. And at last they’re making an appearance
Welcome to Green Rising – It’s easy to shout, “trade, not aid”. And it’s popular too. Who wouldn’t rather earn their keep than rely on handouts. So far, so good. But capitalism, which is what we’re rightly talking about here, relies on the availability of capital. And in most cases that capital to grow businesses comes from banks rather than fancy venture capital funds. Whether it’s revolving credit facilities, trade finance or some other form of commercial banking, Africa’s green economy can’t grow without it. So the fact that some banks are finally starting to lend to businesses in green business sectors is welcome… and overdue. |
 | Banks in Africa are beginning to show interest in the electric mobility sector by offering debt directly to EV companies rather than focusing solely on consumer financing. Senegalese EV company Mbay Mobility has secured $1.2 million in commercial debt from a group of investors, including the National Bank for Economic Development of Senegal. |
African EV startups are demonstrating market traction with viable business models. Their growing fleets and expansion into new markets are making them more attractive and less risky for banks to finance, though not risk-free.
Equity dominates funding for African EV startups. This year, EV startups have raised $357 million in equity, or 78% of total new funding. The share of debt is rising, with a growing number of EV startups leveraging their balance sheets.
Our take: Local banks can unlock EV investment by reducing the cost of debt, extending repayment periods and developing risk-sharing mechanisms… Read more (2 min)
 | African banks are investing more in green finance, with evidence from South Africa showing that five major banks increased renewable-energy lending by an average of 111%. The sector is attracting more investors as its commercial potential becomes clearer. Initially reluctant banks are now doubling down as early entrants show profitability. |
In Kenya, KCB, one of the country’s largest banks, is increasing its green finance share, with more than 26% of its loan book allocated to green projects. It plans to raise $2.3 billion through sustainability bonds over five years.
Beyond the commercial potential of renewables, ESG considerations are also part of banks’ funding requirements. This is pushing lenders to reform strategies to focus on green investments to access a wider pool of capital.
Our take: African banks have an opportunity to finance the infrastructure needed to absorb more renewable power… Read more (2 min)
 | Banks are warming to solar, but they still don’t fully understand the sector. Many treat solar loans like standard debt, ignoring long inventory lead times and rarely offering adequate grace periods, Waringa Matindi, CEO of Village Energy in Uganda, told Renewables Rising. While interest rates are lower than typical loans, they remain high for the sector. |
“Structuring payments monthly or even quarterly is difficult because of the long lead times between ordering inventory and making sales. This timing issue means the repayment schedule often doesn't align with our cash flow cycle. This is why many solar companies may opt for quicker, non-bank financing, even if the interest rates are higher,” said Ms Waringa.
While she appreciates the sector’s progress and supportive policies, she stresses that regulations must keep pace with technology. For instance, tax exemptions for standard inverters encountered challenges when hybrid inverters were introduced.
Read the full conversation here… (2 min)
Number of the week
…was the revenue growth rate of Kenyan EV maker ARC Ride in 2025. Turnover is up from $1.5 million to $4.3 million. That may still be small in absolute terms but seems to present escape velocity for this kind of business on the continent. Most of the revenue came from selling electric motorcycles and accessories, but recurring revenue from battery swap station fees nearly doubled, investors will be pleased to note. The Nairobi-based company raised $33.3 million this year to expand, launching in Ghana and South Africa while preparing to enter Uganda. It is also one of the few local EV companies to publish financial results.
Network corner
Top green jobs from…
Global Communities: Project Director (Tanzania)
Wildlife Conservation Society: Landscape Director (Cameroon)
D.light: Regional Business Manager (Nigeria)
M-KOPA: Legal, Regulatory & Compliance Counsel (Ghana)
One Acre Fund: Government Relations Lead (Burundi)
Aptiv: Program Leader (Morocco)
Anthesis Group: Senior Carbon Scientist (South Africa)
Sun King: Country Training Manager (Zambia)
BURN Manufacturing: Senior Quality Engineer (Kenya)
Earth Enable: Territory Lead (Rwanda)
Reply