Kenya: KCB To Provide 100% Financing For Boda-boda Riders To Acquire 100,000 Electric Motorcycles

In a major boost to Kenya’s nascent electric motorcycle and tuk-tuk sector, KCB has partnered with the United Nations Institute for Training and Research (UNITAR) to roll out a program that will see 100,000 riders benefit from electric motorbikes over the next 6 years. This is expected to create over 150,000 new green jobs in the boda-boda sector. The Bank will provide green affordable loans to the riders to acquire electric bikes and tuk-tuks through local electric motorbikes sellers.

This is a really big deal for the local electric motorcycle sector assembly and manufacturing sector, along with all the downstream industries around the associated ecosystem.

A look at the number of new motorcycle registrations in Kenya shows just much of a big deal the sector is and why it has attracted so much attention from those looking to electrify the transport sector in Kenya. 1,368,676 motorcycles were registered in Kenya in that time, at an average of 195,525 per year. This has attracted over 20 startups in the country’s electric motorcycle space. New registrations of motorcycles had been increasing each year, including during the coronavirus pandemic, until a sharp drop of over 50% last year. Will the registrations shoot up again in 2023?

All these startups need several conditions to be met to guarantee scale. First is an addressable market and a good value proposition/business case. A lot of them have managed to prove the business case and addressable market to a certain extent through various pilots. Now as they scale, they need their prospective customers to have access to financing to be able to take up electric motorcycles. This financing program from KCB for 100,000 electric motorcycles and tuk-tuks will certainly play a key role in this area.

The project that was commissioned by the Cabinet Secretary, Roads and Transport Hon. Kipchumba Murkomen in Nairobi has been rolled out in Machakos county, with a plan to extend it to all counties through the period.

KCB Group CEO Paul Russo said: “The initiative is in line with our commitment to increase our green lending loan portfolio by working with like-minded partners to enhance green job creation and attaining the net zero ambitions.”

“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 play a key role in reducing carbon emissions in the environment, which is part of our long-term plans to conserve the environment,” Russo said.

The program is aligned to the government’s plans to roll out an electric vehicle public transport system that seeks to bring down the cost of transport for all stakeholders. This is aligned to the government’s economic transformation agenda and climate action, which is also expected to reduce the country’s carbon emissions.

Cabinet Secretary, Roads, and Transport Hon. Kipchumba Murkomen said “The government has prioritized the adoption of e-mobility, to achieve a number of targets. There is need to reduced carbon emissions by 32% by 2030. In 2022 emissions in the transport sector was estimated to be 1.26 million tonnes of carbon dioxide.”

“The adoption of electric motorbikes by boda-boda riders will help the country to achieve this target given that 1CE motorcycle emits more carbon than two saloon cars” added Murkomen.