Social Loan From RMB Allows Octotel Greater Digital Inclusivity
Social Loan From RMB Allows Octotel Greater Digital Inclusivity. Fibre network operator Octotel is planning on expanding its network to 500,000 homes with the support of an innovative sustainable financing package from RMB. As a leader in fibre connectivity in the Western Cape, Octotel has passed nearly 300,000 homes with approximately 100,000 customers connected. A new R2bn facility provided by RMB will assist with Octotel’s journey to double the size of their network over the next 3 – 5 years and to drive sustainable digital inclusion in South Africa.
This innovative financing solution will support Octotel’s fibre rollout, particularly as it expands its network to reach areas that currently have no access to fibre. Recognising the broader sustainability benefits of the Octotel fibre rollout strategy, RMB worked with Octotel to structure the loan as a social loan, which is designed to finance projects and activities that address social issues, in this instance access to fibre and high-speed, affordable connectivity. The loan is structured in accordance with the Loan Market Association (LMA) Social Loan Principles (SLP), which is an internationally accepted framework that seeks to facilitate economic activity that promotes positive social outcomes.
“Social Loan financing represents a unique opportunity for RMB to partner with clients who have the potential to increase their social impact. Access to the internet has become a basic need, and while South Africa has good connectivity in major centres, much of the country remains underserved, which limits opportunities in these areas. Addressing this gap, as well as issues around affordability, adoption and use of digital services, is key to an inclusive future. RMB believes that the work of Octotel plays an important role in ensuring digital inclusion,” says Phil Norton, Sustainable Finance transactor at RMB.
“RMB is a long-term funding partner to Octotel, and in 2020 helped facilitate Actis becoming a shareholder, a move that has been instrumental in helping to drive its sustainable growth. The new funding package will further support Octotel’s growth and investment in the construction, development, expansion, upgrading and maintenance of internet infrastructure and installations, which will help South Africa move forward in achieving universal access to broadband,” Norton concludes. Beyond the broader social benefits delivered by improved internet access and quality, Octotel is committed to driving further social impact and digital inclusion. They are adopting several key initiatives, such as exploring lower cost or prepaid products to diversify their offering, driving growth into lower LSM areas, connecting schools within proximity to their fibre network for free, and lowering their carbon footprint.
“We have built a considerable congruent fibre network in the Western Cape and this facility will enable Octotel to meet our growth ambitions in the near term. As importantly, it is harmonious with our core values of making a social impact. Today, access to the internet remains a luxury for many, and it is crucial that we continue to expand our fibre footprint to provide connectivity across the income divide and address inequalities in access to technology, as well as gaps in affordability, adoption and use of digital services.” says Trevor van Zyl, CEO of Octotel.
Matthew McCollum, Director at Actis added: “At the core of Actis’ sustainable infrastructure strategy is an ambition to create sustainability leaders in all our infrastructure investments. Octotel’s social loan will create significant, positive, long-term social impacts, investing in improved digital infrastructure not only leads to faster economic growth, but is also key to meeting the world’s sustainable development objectives.
