Africa healthcare-focused Medical Credit Fund raises $37 mn

 Africa healthcare-focused Medical Credit Fund raises $37 mn

Medical Credit Fund (MCF), a debt fund fully dedicated to the African health sector, said Tuesday it has raised €32.5 million ($37 million) in its second investment vehicle to support more healthcare providers in Sub-Saharan Africa.

The MCF II fund will focus on primary healthcare services including malaria prevention and treatment, and maternal and childcare.

The funding round was anchored by the Dutch Ministry of Foreign Affairs, which provided the first equity injection of €7.5 million in January this year. Also participating in this funding round are CDC Group Plc (€10 million), FMO (€7.5 million), Swedfund (€5 million) and Philips (€2.5 million).

In addition, MCF will benefit from a guarantee facility by the US International Development Finance Corporation (DFC).

MCF, through blended finance, uses catalytic capital from both public and private sources and is targeting to grow to €80 million in the next few years.

MCF said it will deploy the fresh funding to grow its impact across Sub-Saharan Africa with a focus on advancing its digital loan products, which comprise 80% of its disbursements.

“The funds will help to bridge the financing gap for small and medium-sized health businesses, allowing entrepreneurs to finance construction work, purchase equipment, and prevent medicine stock-outs,” said Arjan Poels, managing director at MCF. “Mitigating the chronic underfunding of the sector means more patients can receive better healthcare.”

MCF is part of the PharmAccess group of non-profit organisations dedicated to improving healthcare in Sub-Saharan Africa. It has thus far provided more than 6,500 loans to healthcare providers in Africa, worth over €120 million, with a 96% repayment rate. The firm says it has reached 1,800 SMEs in Kenya, Ghana, Nigeria, Tanzania and Uganda.

Clifford Chance LLP advised on the legal and tax aspects of the establishment of MCF II.

Vivek Sinha

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