[Kenya] Lendable closes second round of asset-backed pass-through notes with institutional investors to expand access to credit across sub-Saharan Africa
Lendable, Inc. a New York and Nairobi based technology-enabled funding provider to frontier market alternative lenders, or non-bank lenders, has announced the closing of an innovative secured dual tranche 36-month note program, called Multi-Originator Segregated Portfolio 2, or “MOP2”. MOP2 is Lendable’s second fundraise of secured pass-through notes backed by consumer, SME, solar and productive asset loans originated by Sub-Saharan alternative lenders using mobile payment technology.
This portfolio will be used to purchase existing loan receivables or make secured loans directly to alternative lenders, who lend to small and micro enterprises and low-income consumer borrowers in Kenya, Uganda, Nigeria, and Ghana.
This was Lendable’s first institutional investor-led round for MOP notes. MOP2’s Senior Note investors included Prudential Financial (their first investment in sub-Saharan African credit), Ceniarth, LLC, Calvert Impact Capital, Sarona Asset Management and Variant Investments. Lendable, through its asset management subsidiary, was the holder of MOP2’s subordinated notes (which comprise 10% of the total outstanding principal amount of all MOP2 notes). Lendable also received the support of an innovative convertible grant for a portion of the Subordinated Notes from the Dutch Development Bank FMO.
“MOP2 marks a significant milestone towards Lendable’s goal of providing fair credit to the under- and un-banked consumer and SME market segment in frontier markets. We are excited that we were able to structure MOP2 to allow institutional investors to participate in our mission and to further diversify our investor base in this way. We are also very excited about the partnership with the Dutch Development Bank FMO, which provides an interesting template for cooperation between Lendable and other DFIs in the future,” commented Daniel Goldfarb, Lendable’s CEO and co-founder.
Lendable was represented by Arnold & Porter and Carey Olsen. Certain investors were represented by McCarter & English and Morgan, Lewis and Bockius.
Lendable was founded in 2014 and provides asset-backed funding facilities to fast-growing alternative lenders across African markets, including off-grid energy companies, small and medium-sized enterprise (SME) lenders and asset finance companies.