As part of the effort towards accelerating the transition to a low-carbon resilient economy and enable the transition of 25% of the total loan portfolio to green investments by 2025, and also as part of the KCB Net Zero ambition, The KCB Foundation and the United Nations Institute for Training and Research (UNITAR) have partnered to promote the use of electric motorbikes by boda-boda riders in Kenya.
The KCB Group is the largest financial services organization in East Africa in terms of asset size. It had an estimated asset base of approximately Ksh 1.02 trillion as at the of end H1 2021. The Group is headquartered in Nairobi, Kenya, with subsidiaries in Kenya, Rwanda, South Sudan, Tanzania, Uganda, and Burundi. In 2007, The KCB Foundation was established to implement the KCB Bank Group’s Corporate Social Responsibility programs and as a sign of commitment to sustainable development to alleviate poverty and enhance well-being. According to their website, the KCB Foundation has invested an estimated 3 Billion Kenya Shillings in community programs in Kenya, South Sudan, Rwanda, Tanzania, Uganda, and Burundi to date. The KCB Bank Group says it is committed to sustainable development, prosperity and poverty reduction to address the hardship, high poverty levels, and interconnected challenges that affect communities in Eastern Africa.
The group also says that it is aligning its green loan portfolio to be at least 25% of the total loan portfolio by 2025, including going beyond by allocating capital and steering financial flows towards more investments and assets that are necessary for transitioning low carbon, climate resilient activities. In the KCB Groups 2021 Sustainability Report, it states that “it aims to introduce products such as green loans and services to the market that will enable customers to reduce environmental and other indirect impacts and/or provide environmental benefits. The development and deployment of green financial products will promote the utilization of renewable energy, trade finance, smart agriculture, sustainable transport and green buildings.”
Here is more on the partnership from KCB Foundations announcement:
The programme involves a user acceptance test, the establishment of a lending scheme for Boda Boda riders, and providing skills training through 2Jiajiri, SACCOs, Associations, motorcycle dealers, and various government departments to support the transition to clean energy.
The pilot phase will kick off in Nairobi, Kajiado and Machakos counties, and will see of 150 motorcycle riders onboarded into the programme at a cost of approximately KES. 38.7 million funded by both KCB Foundation and UNITAR.
Speaking at the event, KCB CEO Paul Russo noted that the partnership with UNITAR is part of the multi-pronged approach by the Bank to work with like-minded partners to support poverty alleviation and job creation efforts in line with the sustainable development needs.
“Through the E-Mobility programme with UNITAR, we seek to make it possible for players in the transport sector to acquire electric motorbikes at an affordable rate and earn a living. At the same time, the Boda Boda riders will be playing a key role in supporting low carbon emissions in the environment. This is a cause we are ready and willing to support as part of our long-term plans to conserve the environment,” Russo said.
Pius Masinde, the Conduct and Discipline Officer at the United Nations said, “This programme will promote electric mobility and ultimately contribute to the achievement of several Sustainable Development Goals (SDG) such as 1: End Poverty, 5: Gender Equality, 7: Affordable and Clean energy, 8: Decent work and Economic growth, 13: Climate Action and 16: Peace, Justice and Strong institutions. We look forward to upscaling the programme in 2023.”
According to the National Transport and Safety Authority, there were nearly 1.9 million registered motorcycles in Kenya as of 2018. In 2021, NTSA registered 285,203 motorcycles compared to the 186,434 registered in 2017. The sub-sector provides more than one million direct jobs for riders who earn roughly less than US$10 a day. This translates to roughly Ksh60 billion yearly in government revenue through taxes, levies and other charges.
I am very excited about all these developments. KCB seems to be very focused and committed to its targets of at least 25% of the total loan portfolio by 2025. The transport sector and electric mobility will be major beneficiaries of KCBs sustainability drive. Recently, KCB partnered with Basigo kenya to finance electric buses for public transport operators. The partnership will see customers enjoy up to 90% funding with an extended repayment period of 36 months while supporting them to reduce their greenhouse emissions and enhance their ability to respond to climate change through adaptation and mitigation measures. In addition, customers will have the privilege to access embedded tracking and fleet management gadgets already installed on the electric bus, plus also insurance financing. Also, battery charging, service, and maintenance will be provided by BasiGo.
We will be following all these developments very closely.
Image from KCB Group’s LinkedIn announcement.
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Source: Clean Technica