- The Off-Grid Market Development Fund (OMDF) aims at increasing access to electricity via off-grid solar energy solutions, from solar lamps to entry-level Solar Home Systems (SHS)
- OMDF launches a Results-Based Financing (RBF) grant program with first submission window for companies from 28 October to 8 December
- In parallel, OMDF is providing credit solutions to distributors and financial institutions active in the off-grid solar sector
- OMDF is managed by Bamboo Capital Partners in partnership with Société Générale Madagasikara, which will host the funds and provide the financing.
Antananarivo, 16 November 2020 – Bamboo Capital Partners (‘Bamboo’), the impact investing platform, has been appointed by the Government of Madagascar and the World Bank as the international fund manager for the Off-Grid Market Development Fund (‘OMDF’ or ‘the Fund’), a USD$40 million renewable energy access fund.
OMDF was established in April and launches its financing operations with a first window for proposals for results-based financing (RBF) from 28 October to 8 December. In parallel, OMDF will also provide debt financing to solar distributors and financial institutions that finance end-customers or solar distributors in Madagascar.
Société Générale Madagasikara has been appointed to host the OMDF funds and provide the financing.
OMDF aims at improving electricity access for households and SMEs in Madagascar through off-grid solar energy solutions. In 2020, it is estimated that less than a quarter of the Malagasy population has access to electricity. Rural areas of the country are unequally electrified, with electrification rates around 5%. Madagascar offers a potential customer base of 2.5 to 5 million households for solar lamps and market entry solar home systems. The Fund will target companies that provide Malagasy households with quality products that are Lighting Global / VeraSol certified.
The Fund was initiated by the Government of Madagascar, with funding from the World Bank. Bamboo’s partnership with Société Générale Madagascar combines the local market knowledge of Société Générale Madagascar with Bamboo’s deep expertise of managing international funds that invest in clean energy access solutions.
“Energy access remains a critical global challenge, with 800 million people without access to a reliable source of electricity. This problem is particularly acute in Madagascar, where access to electricity is a challenge for the large majority of households, especially those in rural areas of the country,” said JeanPhilippe de Schrevel, Founder and Managing Partner of Bamboo Capital Partners. “OMDF builds on our decade of experience investing in the renewable energy sector and we are looking forward to collaborating with the Government of Madagascar, the World Bank and Société Générale Madagascar to provide clean, reliable and decentralized sources of energy to the underserved Malagasy population.”
The Fund will offer both an RBF facility and a credit line for off-grid solar companies and financial institutions active in the off-grid solar sector.
RBF grants support off-grid solar distributors in developing their operations in Madagascar. The grants subsidize companies that offer quality products and services, with additional incentives for those offering end-customer financing solutions via pay-as-you-go models or through MFIs. This facility will also help new market participants overcome entry barriers through a partial prepayment of the RBF grant. OMDF will accept grant proposals from 28 October to 8 December 2020 and again from early 2021.
OMDF’s credit offering specifically finances working capital, stock building of quality products and endconsumer financing. It will also contribute to create credit history in Madagascar to attract further private sector financing.
LEAD Project Coordinator, Jacquis Randriamahazomana, said: “OMDF aims to improve access to electricity for households, especially those scattered, far from the grid, and for SMEs, through the use of solar products in Madagascar. The project will thus support the main objective of the Government of Madagascar’s energy policy, namely “to ensure universal access to reliable, sustainable and modern energy services at an affordable cost” in line with the implementation approach of prioritizing socially equitable renewable energy solutions“.
Zdenek Metelak, Chief Executive Officer of Société Générale Madagasikara, added: “Société Générale Madagasikara and the entire Société Générale Group are extremely honored to contribute to this initiative. This large-scale project is perfectly in line with our commitment to the development of renewable energy, which is part of the Société Générale Group’s Grow With Africa program. We are thus committed to energy operators who support renewable energy projects and energy inclusion of populations.”
About Bamboo Capital Partners:
Bamboo Capital Partners (“Bamboo”) is an impact investing platform founded in 2007 by Jean-Philippe de Schrevel which provides innovative financing solutions to catalyse lasting impact. Bamboo bridges the gap between seed and growth stage funding through a full suite of finance options – from debt to equity – which it activates unilaterally or through strategic partnerships. Bamboo aims to generate lasting impact and improve the lives of the world’s most marginalized communities while delivering strong financial returns. Since its inception, Bamboo has raised over $400m for developing countries, positively impacting over 184 million lives and supporting 45,000 jobs, including 15,900 jobs for women, through its investments in over 30 countries. The firm has a team of 30 professionals active across Europe, Latin America, Africa and Asia. For more information, please visit www.bamboocp.com or follow @bamboocp.
About Société Générale Madagascar:
Société Générale Madagasikara bank is a subsidiary of the Société Générale banking group. Société Générale supports 31 million individual and corporate customers worldwide and places innovation and digital technology at the heart of its business to continuously improve the services it offers. Present in Madagascar for more than 20 years, Société Générale Madagasikara combines financial strength with a sustainable growth strategy, with the ambition to be the relationship bank of reference in its markets, close to its customers, chosen for the quality and commitment of its teams. Based on a diversified universal banking model, Societe Generale Madagasikara supports all categories of customers: corporate, SME/SMI, individual and wealth management customers as well as professionals and institutional investors. The bank currently has a relevant branch network of 59 branches, 5 Espaces Premier and 5 Business Centres throughout Madagascar and employs more than 900 staff. As a committed corporate citizen, Société Générale Madagasikara promotes, on a daily basis, support for education and professional integration, as well as support for the development of Malagasy youth through artistic, sporting and cultural patronage