The International Finance Corporation (IFC) is lending $236Million to Absa, a Johannesburg-based banking group, “to expand its residential and commercial lending programme and mortgage financing for environmentally friendly buildings”.
The funding is expected to promote the IFC’s Design Excellence for Greater Efficiency (DEGE) programme to property developers. This certification encourages the design of buildings that save resources, particularly water and electricity.
It should enable Absa to strengthen its climate finance commitments to its large customer base spread across the African continent (Tanzania, Seychelles, Mauritius, etc.).
Adamou Labara, the IFC’s Country Manager in South Africa, says “the incentives are funded by the IFC-UK Market Accelerator for Green Construction (MAGC) programme, which is sponsored by the UK, to develop green construction in emerging markets by encouraging financial intermediaries to develop and introduce new green construction finance products.”
These investments will contribute directly to South Africa’s Nationally Determined Contribution (NDC) targets under the Paris Agreement.
Absa had earlier received $150Million from IFC in 2021, a facility which was South Africa’s first certified green loan. The lender is a major financial partners of the government’s Renewable Energy Independent Power Producer Procurement Programme (REIPPP).