Electric bus supplier BasiGo has signed a financing agreement with KCB Bank to scale up operations in Nairobi after a seven-month pilot project.
The deal will see the Kenyan bank extend a three-year loan facility covering up to 90% of the 5 million shilling purchase price for the electric buses.
The company which launched operations in Nairobi in March 2022 in conjunction with Citi Hoppa and East Shuttle says the electric buses have traveled 90,000 km carrying more than 112,000 passengers.
The company says it has received more than 100 bookings for its K6 electric bus and wants to increase supply next year, partnering with KCB to target passenger service vehicles.
“The key to getting electric buses on the road in Kenya is to make them affordable for PSV owners. The partnership we signed today with KCB Bank is a game-changer. It will allow bus owners to get a asset financing for an electric bus exactly in line with how they buy diesel buses,” said Jit Bhattacharya, CEO and co-founder of BasiGo.
BasiGo sells the electric buses directly or through a rental model and the company retains ownership of the battery in the bus.
The battery is then leased to the operator PSV via the Pay-As-You-Drive subscription of Sh20 per kilometer.
BasiGo says they mitigate risk to PSV operators by guaranteeing battery performance and providing all bus charging and maintenance.
Electric vehicles are attracting the financial mass of lenders concerned with securing green financing and complying with Environmental Social Governance (ESG) regulations.
The NCBA Group has launched a 2 billion shilling electric vehicle financing as customers increasingly turn to battery-powered cars amid the fight against climate change and rising global oil prices.
The five-year agreement will allow customers to benefit from asset financing of up to 80% of the total cost.
In addition, the NCBA will grant a 10% interest rate on a declining balance for electric vehicle loan applications received within the first 90 days.
Besides banks, e-mobility companies are also using companies like M-Kopa and Watu to buy smaller motorcycle and tuktuk units.
Electric motorcycle companies are leveraging partnerships with asset finance lenders to drive sales in Kenya by targeting boda boda riders.
Swedish-Kenyan tech company Roam has partnered with M-Kopa to deliver a fleet of motorcycles by the end of 2022, in time for a mass rollout in early 2023.
ARC Ride Kenya, which has launched a factory in Kenya producing 500 two- and three-wheel electric scooters and bicycles each month, has also partnered with MKopa and Watu credit to be able to offer the product on flexible financing terms.
As companies like Arc Ride and BasiGo seek to bring affordable electric vehicles to market, a new industry is forming, battery charging hubs that will replace gas stations in the future.
Kenya Power said it would start building electric charging systems for homes, businesses and the public across the country as the shift to clean transport gains momentum.
The electricity distributor said it had enough electricity to charge 50,000 buses and two million motorbikes during off-peak hours.
The Electricity Utility is looking for a company to build an Electric Mobility Network Infrastructure System (ENIS) in Nairobi and Nakuru to pilot the charging stations.
The Kenya Electricity Generating Company (KenGen) has also installed an electric vehicle charging station in Nairobi as the state agency joins other players driving the e-mobility push.