Monday 21st July 2025
By inAfrika Reporter
The Africa Finance Corporation (AFC) has taken a major leap in sustainable financing by securing a $255 million Sustainability-Linked Term Loan Facility, its first of this kind. The facility was anchored by a syndicate of UAE-based financial institutions, reflecting AFC’s evolving funding strategies and its commitment to environmentally-aligned infrastructure investments.
This funding deal links AFC’s borrowing costs to sustainability performance, with lower loan rates offered upon achievement of pre-set environmental targets. By aligning financial metrics with sustainability outcomes, AFC sends a strong message to investors and stakeholders about its priorities. Institutions like First Abu Dhabi Bank, Mashreqbank, and Emirates NBD acted as key coordinators in the transaction.
Banji Fehintola, Executive Board Member at AFC, described the deal as a turning point. It not only diversifies funding sources but also aligns with AFC’s broader mission to catalyse sustainable infrastructure development. AFC has been active in securing diversified capital, raising over $1.16 billion in syndicated loans in 2024, along with other innovative financial instruments like hybrid capital and Murabaha facilities.
Moreover, AFC has committed itself to green infrastructure. Its equity stake in Lekela Power through Infinity has made it Africa’s largest renewable platform with 1 GW of clean energy, serving 1.2 million homes and preventing nearly 8 million tonnes of CO₂ emissions annually.
By embedding sustainability into its financing frameworks, AFC is pioneering a new model of development finance in Africa one that links economic growth with environmental responsibility. This sustainability-linked loan strengthens its partnerships in the Gulf and sets the tone for future projects across the continent.
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