Safaricom secures ESG-linked $137m loan

Details: Manny Pham; Category: Operators; 05 September 2023; 7009 views

Safaricom announced it secured a deal to gain a loan of up to KES20 billion (US$137 million) from a consortium of Kenyan banks to fuel its sustainability plan, in what the operator claims is the first ESG-linked loan facility in East Africa.

The Kenyan operator stated it will initially gain KES15 billion which is up-scalable to KES20 billion from Standard Chartered Bank, Stanbic Bank, ABSA Bank and KCB Bank. The financial institutions will enable Safaricom to access the funds based on its progress in setting milestones in key ESG areas.

Specifically, the operator will focus on reducing its emissions to reach Net Zero targets, tracking gender diversity, and monitoring social equality impacts. 

Safaricom will deepen its focus on strategic sustainable investments to transition into a fully-fledged technology company by 2025.

The deal also paves the way for more ESG financing in East Africa as companies seek to be held accountable for their ESG footprint.

Safaricom CEO Peter Ndegwa said: “In line with our focus to advance our sustainable business agenda, this funding will unlock our ability to create more diversified investments that will support transformative investments in new technologies, systems and services that allow us to comprehensively manage our ESG footprint.”