East African pay-as-you-go solar energy provider M-KOPA Solar has raised US$80 million in committed financing to be used over the next three years to finance installations in one million homes, on top of the 500,000 already connected.

To date, M-KOPA Solar has connected over 500,000 homes in East Africa to affordable, safe and clean energy, with its predominantly low-income customer base accessing lighting, phone charging, radio and TV on daily mobile money payment plans.

The funding - which is the largest commercial debt facility to date in the PAYG off-grid energy sector - comes in part from Stanbic Bank, which has committed US$9 million.

"Stanbic's team was innovative and flexible in its approach, which allowed the lenders to provide a large line of credit for our receivables. This record-breaking facility is being deployed primarily into off-grid households, with per capita income of less than US$2 per day," said Chad Larson, chief credit officer and co-founder at M-KOPA Solar.

"Over the past year, Stanbic and M-KOPA have worked collaboratively to design a facility that reliably funds M-KOPA's growth in local currency, while providing considerable safeguards for the lending syndicate."

Stephen Lovell, head of corporate financing solutions in East Africa at Stanbic, said his company was excited to partner M-KOPA Solar.

"Through this innovative debt financing solution, which is the largest of its kind, the company is able to fund the next wave of pay-as- you-go installations across East Africa. We are proud to be a part of this landmark transaction and the positive impact it will have on lives and communities," he said.

Meanwhile CDC (US$20 million), FMO (US$13 million) and Norfund (US$13 million) are part of the lending syndicate. It will be backed by customer receivables, paid over mobile money payment plans.

M-KOPA has also secured US$25 million in debt from responsAbility, Symbiotics, and Triodos Investment Management.

Jesse Moore, CEO and co-founder of M-KOPA Solar, said CDC's debt investment comes on the back of it leading the company's series F equity raise last year.

"We're delighted that Stanbic, Norfund and FMO are also investing. This facility offers lenders the chance to connect low-income homes to power and information – while delivering sustainable returns. It's part of an emerging trend for development partners and investors to look at more cost effective ways to fund last mile connectivity," he said.