Airtel Africa has signed an agreement to borrow $194 million (Sh23.8 billion) from the International Finance Corporation for the expansion of its mobile internet business in Kenya and five other markets on the continent.
The facility has a tenor of eight years and will be used to support Airtel Africa's operations and investments in the Democratic Republic of Congo, Kenya, Madagascar, Niger, Republic of Congo and Zambia.
IFC will provide Airtel Africa’s subsidiaries including Airtel Kenya with local currency loans in line with the multinational’s strategy to increase debt within its operating companies.
"I am very excited to announce the signing of this new facility with IFC,” Airtel Africa’s chief executive Segun Ogunsanya said in a statement.
“Not only does it align with our focus on improving our balance sheet through localising debt within our operating companies, but as we make progress on our sustainability journey it also supports our commitments and ability to meet strong environmental, social and governance (ESG) criteria.”
The global financier, part of the World Bank Group, said the funding will help connect millions of new subscribers to mobile internet in the six countries.
According to data from the telcos’ association GSMA, less than half of sub-Saharan Africa’s population had access to mobile services at the end of 2021 while only 28 per cent of the population had access to mobile internet.
GSMA also estimates that by 2025, the value added by mobile technology and services will reach almost $155 billion (Sh19 trillion).
"The Covid-19 pandemic has made mobile connectivity even more urgent for both social and economic development,” Sérgio Pimenta, IFC Vice President for Africa, said in a statement.
“Helping more people connect to affordable and fast internet networks is a priority for IFC in Africa, especially in the continent's lower-income countries. The partnership with Airtel Africa will help achieve this."
Most people in Kenya and other African countries primarily access the internet through mobile phones which are cheaper and more accessible compared to other devices like laptops and desktop computers.
Telcos also sell small data bundles to be consumed on handheld devices, giving owners of mobile phones an option to buy internet services when they need them.
Airtel and other mobile operators are investing heavily in 4G technology which offers faster internet connectivity compared to the earlier 3G system.
Increased competition among the players and falling prices of smartphones is expected to further expand access to mobile broadband seen as critical in transforming lives.
The internet is now used widely for e-commerce, entertainment, education and communication, among other uses.
Mobile operators offer mobile internet as a stand-alone service or as a bundle with others like voice and messaging.