Mogo Kenya Doubles Bank Funding to KSh1.6 Billion as Investor Support Grows
Mogo Kenya Doubles Bank Funding to KSh1.6 Billion as Investor Support Grows
Mogo Kenya has doubled its local bank funding to KSh1.6 billion from KSh800 million, following increased credit facilities from Ecobank Kenya and I&M Bank.
The development has pushed the company’s total local funding to more than KSh9 billion, with a significant share raised through private placement programmes targeting Kenyan institutional investors.
The programmes, arranged by Dry Associates Investment Bank, have attracted pension funds, mutual funds, asset managers and insurance companies seeking investment opportunities in asset-backed lending.
The funding is being used to finance motorcycles, cars, tuk-tuks and smartphones for individuals and small businesses through loans structured in Kenyan shillings.
The private placement programmes run for between one and three years and are secured through a guarantee from Mogo’s parent company, Eleving Group, alongside loan collateral.
The funding milestone comes as Global Credit Rating Company (GCR Ratings) assigned Mogo Kenya a long-term issuer rating of BBB-(KE) and a short-term issuer rating of A3(KE), both with a Stable Outlook.
GCR also assigned Mogo’s bond programmes ratings of A(KE)(EL), providing an independent assessment of the company’s credit profile and its local funding programmes.
The ratings agency cited improvements in earnings, a stronger competitive position and growth in Mogo’s loan portfolio. It also highlighted the expansion of motorcycle and tuk-tuk financing, the resumption of smartphone financing and continued support from Eleving Group.
Dry Associates Investment Bank Managing Director James Dry said the programmes had attracted growing interest from institutional investors since their launch in 2022.
He noted that investors were increasingly looking for local-currency investment opportunities linked to the real economy and supported by clear security structures and transparent reporting.
Mogo Kenya Deputy Country Manager Branton Mutea said increased support from local banks and institutional investors would help the company expand its lending capacity while maintaining responsible growth and risk management.
The company said a larger local-currency funding base would also help align its financing sources with loans issued in Kenyan shillings, reducing exposure to foreign-exchange movements.
I&M Bank Director of Retail and Business Banking Shameer Patel said the bank had increased its facility to Mogo to KSh1 billion, citing the role of asset financing in supporting entrepreneurs and small businesses.
Ecobank Kenya Director of Corporate Banking for Kenya and EAC Cyprian Rono said the expanded facility would help more entrepreneurs and micro, small and medium-sized enterprises acquire assets needed to strengthen their businesses.
Mogo’s financing model targets Kenya’s asset-financing market, particularly the motorcycle sector, where ownership can provide an income-generating opportunity for riders.
A report by Viffa Consult, titled Kenya’s New Boda-boda Boom, estimates that the motorcycle sector contributes approximately KSh660 billion annually to the economy, equivalent to about 4.4 per cent of Gross Domestic Product (GDP), while supporting more than 2.5 million young Kenyans.
The report also estimates that a motorcycle rider could spend about KSh780,000 over five years through rental arrangements, compared with KSh340,000 through asset financing.
Beyond vehicle financing, Mogo has expanded into smartphone financing, having financed more than 200,000 devices in partnership with mobile phone brands.
The company has also entered a partnership with ZTE Corporation, targeting the financing of more than 500,000 smartphones over the next 12 months.
