Kenya is among the fastest-growing electric vehicle markets in Africa. Registrations of battery-operated cars and bikes in the country increased by more than five times in the past year.

While several EV brands are competing for a share of the market, much of this growth has been powered by a financing company: M-Kopa.

Two out of every three electric bikes sold in Kenya are financed by the company, according to local media. 

Founded in 2012, M-Kopa has been a household name in Kenya, enabling over 3 million people to buy televisions and smartphones through its buy-now-pay-later (BNPL) lending model, where consumers pay off a purchase in installments. 

In 2022, M-Kopa extended its BNPL model to EVs, and has become the backbone of the sector in a short span of time, EV makers, mobility experts, and consumers told Rest of World. They say EV adoption in the country would have been nearly impossible without M-Kopa, due to the high upfront costs of purchasing the vehicles. M-Kopa has achieved this feat through tie-ups with most key EV manufacturers selling in Kenya, and also partnered with ride-hailing company Bolt to boost electric car sales in the country.

“More than 90% of our bikes are financed by M-Kopa. They are critical to us [for] getting our bikes off the ground,” Felix Eningsjö, a regional sales executive at Kenyan EV manufacturer Roam, told Rest of World. 

M-Kopa decided to enter EV financing in 2022 because it was cheaper in the long run, David Damberger, managing director of M-Kopa Mobility, told Rest of World.

“The problem with financing [gas-powered motorbikes] is that they’re pretty easy to steal, pretty easy to hack, there’s a lot of fraud, and it’s difficult to finance them,” Damberger said. “The cost of a 100 kilometers of fuel is about $4, the cost of 100 kilometers of electricity is less than $1.”

The company also invests in research and development, which experts say has helped it remain competitive. In 2016, it established “M-Kopa labs” to experiment with off-grid appliances that serve low-income households and use alternative energy sources.

“Specialization in EV financing, together with their R&D around battery management, has positioned them as a strong partner for the EV transition,” Warren Ondanje, managing director at Africa E-Mobility Alliance, a Nairobi-based electric-mobility advocacy firm, told Rest of World. “Something the competition doesn’t have much of.”

Part of M-Kopa’s success can be attributed to its leadership team, which has significant experience in running technology businesses in Kenya. 

Nick Hughes, one of M-Kopa’s three co-founders, helped create M-Pesa, Kenya’s ubiquitous mobile money app. M-Kopa’s CEO, Jesse Moore, has been involved with funding startups in Africa for nearly two decades.

Several gig workers — bike-taxi drivers and food delivery workers — told Rest of World they have been able to afford electric bikes because of M-Kopa, and that the company has helped them reduce expenses.

James Kiragu, a Nairobi-based gig rider who bought an electric bike in January, said that maintaining his old vehicle had become too expensive and he was able to upgrade to an EV because of M-Kopa. Kiragu made an initial payment of 25,000 Kenyan shillings ($188) for the bike. He told Rest of World his take-home income has doubled due to the savings on fuel costs. “After doing my own calculation between the petrol and the electric bike, I see that electric bikes are the best because you can save some money,” he said.

In April, ride-hailing platform Bolt partnered with M-Kopa to roll out 5,000 electric motorbikes in Kenya. M-Kopa will help gig riders access the bikes to work on Bolt’s platform and pay as they drive.

“Considering all financial incentives and reduced operating costs, drivers participating in this pilot launch could see significantly increased daily earnings compared to petrol motorcycles,” Caroline Weichai, regional director of ride-hailing operations at Bolt, said during the partnership announcement.

M-Kopa has also partnered with Spiro, Africa’s biggest electric bike company, Damberger said. While it does not have a direct partnership with Uber, it finances vehicles for Green Wheels, the company managing the fleet of electric bikes on Uber’s app, he said.

In the second half of 2022, when M-Kopa first started financing EVs, it sold only 26 bikes. In comparison, during the first six months of 2024, the company sold 1,000 bikes, according to Damberger.

“It’s impossible to achieve a level of growth comparable to that of [internal combustion engine] bodas without financiers and government incentives,” Kim Chepkoit, founder and CEO of Ecobodaa, a Nairobi-based electric bike company, told Rest of World. “The users are youths who cannot access credit anywhere else apart from asset financiers.”

In April 2022, M-Kopa partnered with Ampersand, Rwanda’s biggest EV company, which also has a large presence in Kenya. So far, over 80% of the company’s bikes in Kenya have been financed by M-Kopa, according to Hezbon Mose, Ampersand’s Kenya country director.

There are concerns, however, that M-Kopa charges high interest rates on its BNPL model.

“The challenge [with M-Kopa] is the cost of financing is high for customers [and] high financing cost becomes expensive so it limits growth for customers,” Mose said. He added that riders who opt for an 18-month repayment plan will pay 680 Kenyan shillings ($5.23) every day for 550 days, and end up paying 374,000 shillings ($2,877), which is “40% more than the cost of the motorcycle.” 

Damberger said that M-Kopa’s pricing is high because it includes insurance for accidents and theft, and also health coverage.

“It also covers all the costs we have to incur, namely paying for the cost of the capital, the high cost of foreign exchange losses [as M-Kopa purchases the bikes with U.S. dollars], the cost of sales and distribution, the cost of offering 24/7 customer care, and finally our own margin, which is relatively small,” he said.