Though important to the economy, most still lack adequate financing, and many operate on thin margins with limited power access. 

These same businesses are now facing two major changes at the same time, the need to operate sustainably and the spread of green technology.

Green technology, clean energy, efficient processes, waste innovation and climate‑smart leverage, are changing markets worldwide. My argument is for African SMEs, sustainability need not be a cost centre or an aspirational label. 

With the right mix of policy, finance and adoption, green tech can be a profit engine, making SMEs stronger, more resilient and more competitive.

Top Policies to Watch: 2026 as Year of Institutional Discipline

SMEs: The Backbone of Africa’s Economy

Across the continent, SMEs make up the majority of businesses, informal and formal, and are vital to jobs and growth. They generate over half of Africa’s economic output. In low‑income economies, their share is usually over 50%. 

Meanwhile, less than a fifth of them have access to formal credit, leaving a massive investment gap. 

They are agile. They innovate. But they also feel immediate pressures such as high energy costs, unreliable electricity, and limited access to modern tools. That’s where green tech steps in.

What Green Tech Means for SMEs

Green tech is usually described at a national or multinational scale, but for SMEs, it’s far more concrete:

• Clean Energy: Solar panels and mini‑grids are now more affordable than ever. They replace expensive diesel generators and provide more reliable power.
• Climate‑Smart Agriculture: Irrigation tech, soil health systems and drought‑resistant methods help farms produce more with less risk.
• Circular Economy Innovation: Recycling and waste‑to‑value models turn disposal costs into revenue streams.
• Efficiency Tools: Software and sensors help track and reduce energy, water and fuel use.

These technologies directly relieve cost pressures that have long throttled small businesses.

Turning Sustainability into Profit

The common misconception is that sustainability means higher costs. That’s really not the case:

1. Lower Operating Costs

Energy is a top expense for many SMEs. Solar power and energy‑efficient equipment cut utility bills and stabilise cash flow. Diesel generators are expensive and unreliable; solar kits paired with batteries provide a predictable cost base and reduce downtime. 

Recently, many African nations doubled imports of solar panels, showing expanded adoption of off‑grid clean energy solutions. 

2. New Revenue Streams

Green tech opens revenue paths that didn’t exist before:

• Excess energy sales: Micro solar and wind installations can feed local grids in some markets.
• Green services and products: Eco‑certified goods attract premium buyers domestically and internationally.
• Carbon and sustainability financing: As investors move to climate‑aligned assets, businesses with measurable sustainability credentials gain access to new capital pools.

In Nigeria, for example, SME sector frameworks now channel climate finance toward climate‑smart business practices, providing tax incentives and credit support for firms adopting environmental, social and governance (ESG) criteria.

3. Competitive Advantage

Consumers are paying attention. In urban markets especially, buyers value brands that reduce waste or support local sustainability. This trend influences buying decisions, pricing power and marketing stories.

Limitations and Solutions

Of course, the transition isn’t automatic. SMEs face some limitations:

• Financing gaps: The IFC estimates a funding shortfall in sub‑Saharan Africa exceeding $300 billion for SMEs. 
• Infrastructure deficits: Reliable transmission, storage and connectivity are still uneven, meaning some green tech can’t reach scale without support.
• Skills and capacity: Even affordable tech requires basic training and maintenance skills.

But solutions are emerging. Blended finance, where development finance, private capital and risk guarantees come together, is gaining ground. 

African financial institutions have pledged more than $100 billion for green growth initiatives, aiming to support renewable adoption and sustainable trade. 

There are also targeted funds focused on SMEs. For example, a $150 million solar green bond was launched to support rooftop installations and other productive uses for small businesses.

Policy and Finance: A Macro View

A supportive policy environment is important. Governments that extend tax incentives, import duty breaks on clean tech and clear sustainability standards make it easier for SMEs to adopt innovations. 

National climate strategies that link SME development with energy transition targets align private and public objectives.

At the same time, climate finance flows into Africa are increasing but still far below needs. Recent data show funding grew nearly 50% in a short period, yet meets only about a quarter of the amounts required to fulfil climate commitments by 2030.

Sound policy can bridge that gap, combining international funds with domestic private sector mobilisation.

Across the continent, green tech is already changing business trajectories:

• In rural villages of Mali and beyond, solar mini‑grids are enhancing local commerce, reducing daily energy costs and enabling businesses like welding shops and bakeries to thrive.
• In South Africa, programmes that open the energy market to private producers are expanding renewable capacity and encouraging SMEs to invest in their own energy solutions. 

These are templates, scalable, replicable and profitable.

With Africa’s population projected to approach 2.5 billion by 2050 and energy demand set to surge, green tech adoption is indispensable. 

The renewable transition is a chance to leapfrog legacy infrastructure and unlock prosperity aligned with climate resilience.

SMEs are nimble, they touch communities and can lead this change. They can scale change faster than large firms burdened by legacy systems. So long as financing, policy and capacity building advance together, green tech can be an engine of both sustainability and profit.

What SMEs Should Do Now

1. Get the basics right: Audit energy and resource use to identify quick savings.
2. Explore blended finance: Seek partnerships that de‑risk green investments.
3. Build competencies: Train staff on energy management and digital tools.
4. Tell your story: Document sustainability metrics to unlock premium markets and capital.

SMEs in Africa have long been engines of growth and now they are at the brink of another chapter, 2026, where sustainability is a driver of profitability, not a burden. 

Green tech isn’t just an add‑on but a strategy, and those who leverage it early will thrive well.

Consumers and businesses are constantly striving for the latest and greatest technology. However, behind the pursuit of cutting-edge devices lies a significant environmental toll – one that often goes unnoticed.

The production of new technology requires vast amounts of natural resources, energy, and labour, contributing to both environmental degradation and significant carbon emissions.

With concerns about sustainability at an all-time high, companies are now looking for ways to reduce their environmental impact without compromising on performance or innovation.

Refurbished tech, such as the solutions offered by Qrent, presents an effective, affordable, and eco-friendly alternative.

The refurbished computers and laptops market is set for remarkable expansion, driven by both cost-effectiveness and a growing commitment to sustainability.

According to Credence Research, the market is projected to surge from USD 17,856.6 million in 2024 to USD 39,405 million by 2032, achieving a compound annual growth rate (CAGR) of 10.4% during the forecast period.

This growth underlines the increasing adoption of refurbished IT equipment by businesses, educational institutions, and individual consumers as they seek to balance performance with environmental responsibility.

The rising trend not only helps organisations reduce capital expenditures but also supports circular economy initiatives by extending the lifecycle of electronic products

As businesses face increasing pressure to meet environmental, social, and governance (ESG) goals, refurbished tech is fast becoming a preferred choice for companies looking to cut costs while reducing their carbon footprints.

At Qrent, businesses can access high-quality, refurbished IT equipment that meets the demands of modern enterprises while simultaneously supporting sustainability initiatives.

The company provides a range of refurbished devices including computers, laptops, and servers, ensuring that businesses can operate efficiently while minimising their environmental impact.

These devices are thoroughly tested and restored to like-new condition, offering the same reliability and performance as their brand-new counterparts but with a fraction of the carbon footprint.

Refurbished tech and the circular economy

The transition to a circular economy – a system that emphasises reusing, recycling, and remanufacturing – has become a critical strategy in tackling the world’s waste crisis.

The electronics industry is one of the largest contributors to this crisis, with e-waste being the fastest-growing waste stream globally.

By choosing refurbished technology from Qrent, businesses contribute directly to the circular economy. When companies choose to refurbish and extend the lifecycle of their IT devices, they prevent valuable resources from ending up in landfills and reduce the demand for new products, thereby conserving raw materials and decreasing pollution.

Qrent’s refurbishment process includes the responsible recycling of old components and ensures that all equipment is brought back to life in an eco-friendly manner. This not only helps in reducing waste but also plays a significant role in limiting the environmental impact of tech manufacturing.

Embracing circular economy strategies not only prolongs the lifespan of IT assets but also significantly cuts down the need for new manufacturing – thereby reducing carbon emissions.

The 2024 Forrester Report on The Circular Economy & Sustainable Manufacturing reveals that a substantial share of firms are already reaping sustainability benefits: 38% have adopted innovative delivery and fulfilment options that minimise waste, 32% are improving waste management practices, and 28% are focusing on more efficient material sourcing.

By opting for refurbished technology, companies can leverage these practices to lower reliance on virgin materials and the high emissions associated with producing new devices, marking a crucial step toward a greener, more sustainable IT procurement model.

Attaining your sustainability goals

Qrent provides businesses with sustainable IT solutions. The company not only supplies refurbished technology but also offers a comprehensive range of services that include equipment leasing, IT asset management, and secure data destruction.

Businesses can now gain access to a scalable solution that meets their IT needs while simultaneously supporting their ESG initiatives.

The company’s commitment to reducing e-waste is evident in its emphasis on responsible recycling and disposal practices.

When companies dispose their old IT equipment with Qrent through their IT Asset Disposal Solution, they can be confident that their devices will be decommissioned properly and reused, ensuring that valuable materials like metals, plastics, and glass are recovered and re-entered into the manufacturing cycle.

This process prevents toxic substances from polluting the environment and ensures that e-waste is managed in a safe, responsible manner.

Renewable energy startups in Africa have cumulatively raised $836.1 million to date and in recent years, the financial sector has shifted towards green investments.

Clean energy spending now surpasses fossil fuel investments at a ratio of 2:1. In 2024, global energy investment is projected to exceed $3 trillion for the first time, with $2 trillion allocated to clean energy technologies and infrastructure. This is a commendable increase from the $1.8 trillion invested in 2023, showing a 17% year-over-year growth. 

In 2023, global investment in renewable energy reached approximately $619 billion, an 8% increase from the previous year. For every dollar spent on fossil fuels, $1.7 was allocated to clean energy, showing a strong global move towards sustainability.

Projections by Bloomberg disclose that Environmental, Social, and Governance (ESG) assets are steadily growing to surpass $53 trillion by 2025, representing more than a third of the anticipated $140.5 trillion in total assets under management.

The green bond market is also well-prepared for strong growth, potentially reaching $2 trillion by 2025, with a compound annual growth rate of 25%.

Added to this, power sector investment in solar photovoltaic (PV) technology is expected to exceed $500 billion in 2024, surpassing all other generation sources combined. This momentum points to a great period in sustainable finance, driven by technological advancements, supportive government policies, and increased environmental awareness.

Green Startups in Nigeria

Nigeria is quickly becoming a top choice in the global green investment sector. Since 2019, Nigerian climate-tech startups have raised over $3.4 billion, with investors having a growing focus on sustainable development.

One good example is Earthbond, a Lagos-based startup founded in 2023 by Chidalu Onyenso. The company addresses Nigeria’s $14 billion off-grid generator market by facilitating access to solar energy through group financing and carbon accounting. 

In October 2024, Earthbond secured $200,000 in pre-seed funding from Madica Ventures, bolstering Nigeria’s green economy.

Other startups include Daystar Power, which has raised $88.5 million to expand its clean energy products and services, Rensource Energy has raised $28.6 million to expand its Power-as-a-Service (PaaS) offerings across Nigeria and West Africa, Arnergy secured $12 million to continue providing reliable solar power solutions for businesses in emerging markets and Beacon Power Services obtained $2.8 million to enhance its energy management software and analytics for utilities.

Again, Ashipa Electric raised $120,000 to develop reliable microgrids in Africa and the Caribbean Islands, Imperium Energy received seed funding of N20 million from the Development Bank of Nigeria (DBN) for its innovative low-cost clean power solutions and SunCulture provides solar-powered water pumps for irrigation, enabling smallholder farmers to access reliable and sustainable energy solutions. In 2024, SunCulture raised $27.5 million to expand its operations.

Challenges and Opportunities

Challenges

Quite alright, we have a commendable view of the green sector, but some challenges could cause limitations:

1. Funding Gaps: Africa requires approximately $277 billion annually to meet its climate goals for 2030.
2. Geopolitical Conflicts: International conflicts and trade disputes disrupt renewable energy supply chains.
3. Regulatory Instability: Inconsistent policies across regions create limitations for investors.
4. Unpredictable Market: Fluctuations in energy prices and financial markets impact the attractiveness of green investments.

Opportunities

On the contrary, the growth of green investments brings lots of opportunities:

1. Innovations in Clean Technology: Innovations in energy storage and efficiency are reducing costs and increasing adoption rates.
2. Supportive Policies: Governments worldwide are implementing fiscal incentives and environmental regulations to promote green investments.
3. Private Capital Flow: Increased private sector involvement is narrowing funding gaps for climate-tech startups.

Economic Impact of Green Investments in Nigeria

Green investments are influencing Nigeria’s economy in the following ways:

1. Economic Growth: The green economy presents an estimated $250 billion in investment opportunities in Nigeria, driving GDP growth.
2. Job Creation: Renewable energy projects can create numerous employment opportunities, from technical roles to research and development positions.
3. Energy Security: Projects like solar farms and microgrids improve electricity access, reducing reliance on diesel generators. For instance, a $750 million World Bank program aims to enhance electricity access for 17.5 million Nigerians.

Again, the Nigerian Green Bond Market Development Programme, launched in 2018, has helped in promoting climate-resilient financial instruments. This initiative laid the foundation for Nigeria’s maiden sovereign green bond in 2017, valued at $26 million.

The Global Context: Investors and Policies

Investors managing over $29 trillion in assets have called for stronger climate policies, emphasizing the necessity of fiscal incentives to support the clean energy transition. 

Nonetheless, there were issues such as a 20% drop in climate tech funding in the first half of 2024, but targets set at the COP28 summit aim to triple renewable capacity and double efficiency by 2030.

Will Green Investments Dominate?

So, the course of green investments appears to be a good one. Global economic growth is projected to increase by 3.3% by 2025 (OECD). Sustainable finance, driven by ESG-linked products and green bonds, is expected to dominate the financial sector.

In Nigeria, the collaboration of government support and private sector innovation will ensure startups in the industry scale beyond the immediate environment.

Green investments are steadily growing and this is bolstered by technological progress, policy support, and environmental consciousness, bringing a unique opportunity for Nigeria to thrive in sustainable development. 

Strategic investments and strong policies will be essential in realising this vision, making green investments a high contributor to economic growth.

ESG investing has grown exponentially in recent years, reaching USD $38 trillion globally, but emerging markets still attract less than 10% of ESG funds despite their 58% contribution to global GDP.

FII Institute interviewed top investors who cited ESG rating agencies as a major barrier due to irrelevant KPIs.

In response, FII Institute teamed up with EY to launch the Inclusive ESG Framework in 2022 and collaborated with ESG Book to create the Inclusive ESG Score and Tool launched at FII7, unlocking new opportunities for investors interested in emerging markets.

For Investors:

The Inclusive ESG Score identifies ESG-focused companies, guiding the Inclusive ESG Ranking of the Top 250 sustainable emerging market companies for investment consideration.

For Emerging Market Companies:

The Inclusive ESG Tool tailors metrics to address emerging market challenges, allowing companies to disclose their data and receive an Inclusive ESG Momentum Score, which indicates current performance and future ESG commitment, supporting positive change.

Richard Attias, CEO, FII Institute, said:

“Our planet faces immense challenges, including global warming, a rapid decline in biodiversity, and an increasingly unbearable cost of living for many. However, we are not without the means to address these issues. Our global financial markets are more interconnected and driven by change than ever before. Investing in ESG (Environmental, Social, and Governance) initiatives plays a pivotal role in the solution. These funds should be strategically directed toward emerging markets where their impact is most needed, all while ensuring the returns necessary for the vitality of these markets.”

Dr Daniel Klier, CEO, ESG Book, said:

“We are delighted to be collaborating with FII Institute to usher in a new approach to ESG data in emerging markets. The Inclusive ESG Score is a next generation tool for investors that identifies the sustainability leaders of today and tomorrow, with a transparent, data-driven approach that is tailored to emerging markets. Through this partnership, we look forward to providing a solution that enhances investment decision-making, and in turn helps to drive greater ESG investment flows to emerging market companies.”

If you’re reading this, there’s a very good chance you’re already familiar with the acronym ESG.

Standing for “environmental”, “social”, and “governance”, it’s a constantly evolving standard that emphasises the importance of doing business in a way that positively impacts the environment, society and stakeholders.

In essence, it’s the idea that companies can grow and profit while doing good and it encourages businesses to be more transparent about how they add to or create value for their society, community and/or stakeholders. 

While ESG has its critics (on both sides of the aisle), its philosophy has gained near-universal acceptance in investor circles. In fact, a 2022 study by asset management firm Capital Group found that 89% of investors consider ESG issues in their investment approaches.

Additionally, there are around US$2.5 trillion in ESG assets under fund management. And with rising interest rates putting a dampener on investment (including in Africa), scoring well on those metrics may become more important than ever. 

But for African fintechs the case for ESG goes beyond becoming investable. Implemented properly, the principles behind ESG make a great deal of business sense. As an illustration of how much of a boost it can be to a business, a study by accounting firm Moore Global found that companies with strong ESG principles saw their profits grow 9.1% in the three years between 2019 and 2022.

In other words, the fintechs that get ESG right won’t just have an easier time attracting investment, they’ll also be better poised for growth, sustainability and profitability. 

Why ESG works 

Before looking into how African fintechs can put together the kind of ESG frameworks that encourage growth and investment, it’s worth taking a deeper look at why it makes good business sense (outside of the already strong investment case) to invest in ESG. 

One of the most powerful is the African environmental context. According to the Africa Development Bank, for example, Africa is the continent most vulnerable to climate change.

Any fintech that understands this and works to ensure that its operations are sustainable isn’t just helping mitigate the effects of climate change on the planet, it’s also helping ensure a future environment in which it’s more likely to survive and thrive. 

Of course, ESG isn’t just about the environment. Its second social pillar has an equally important role to play. For fintechs this can look like ensuring that they hire diversely, support MSMEs, and contribute positively to employment in areas where it’s needed most. But perhaps even more importantly, it also includes financial inclusion.  

Choosing to hire diversely has obvious societal benefits: for example it means that previously marginalised groups are able to participate in the economy at much higher levels. But it also comes with significant business benefits. And the higher up the organisation those hires climb, the greater the accrued benefits are.

According to the Boston Consulting Group, companies with above average diversity in their management team report 19% higher innovation revenues than those with lower diversity. 

Supporting micro, small, and medium-sized businesses also benefits fintechs. For starters, they make up a large customer base (particularly for B2B-focused fintechs) on the continent. In sub-Saharan Africa, there are approximately 44 million SMEs.

These enterprises not only serve as the engine of many economies across the African continent, but they also represent a segment historically ignored and under-served by the more traditional financial services players.

By providing products and services which speak directly to the pain points of micro and small enterprises, fintechs can not only tap into a fast growing and profitable segment, but can have a positive impact on the overall economic development and prosperity in the country in which they operate.

Growing financial inclusion in the region, meanwhile, is absolutely critical. At present, just 43% of people in sub-Saharan Africa have a formal bank account. That makes it difficult to access things like vehicle, home, and business loans that can be used to grow income. It also means that any savings the unbanked have can’t be used for wealth generating investments.

Across the region, fintechs are helping people overcome those barriers by expanding financial services such as digital banking, microfinancing, and digital payments to people who wouldn’t previously have access to them. 

The final pillar within the ESG framework, focuses on governance and this is often an overlooked and misunderstood pillar. I am an avid advocate and loud champion of strong corporate governance workings, but I am often asked how strong governance arrangements actually help an organisation thrive and grow. 

Many people equate good governance with rigid structures and bureaucratic processes, but I respectfully disagree with these assertions. The truth is that a solid corporate governance foundation, coupled with the right corporate culture, has exactly the opposite effect.

It frees an organisation from confusion and unnecessary work. It allows for decisions to be made more freely by people who have been empowered to take decisions. It ensures that key decisions are placed with and taken by the most appropriate individuals within an organisation. And it allows for a dynamic, organised, and agile organisation. 

Examples of good governance practices every fintech should have in place include transparent decision-making processes, ethical behaviour, and accountability to stakeholders. This, in turn, helps build trust with customers, investors, and (increasingly stringent) regulators; fostering long-term sustainability and growth.            

Building the right frameworks 

Of course, claiming to be ESG compliant and having an effective ESG framework are two different things. While there are a variety of approaches that can be taken in doing so, at MFS Africa we take a three-pillared approach that focuses on “setting”, “measuring”, and “reporting” the impact we have in local communities and across the Africa continent. 

During the “setting” phase, we outline the parameters which will guide the organisation in its ambition to build a strong impact-driven organisation with a clear ESG approach. Having done that, we measure against those parameters and then report transparently on those measurements. 

While each organisation should tailor its ESG framework according to its individual needs and context, we’ve found this model to be the one best suited to us. It’s helped us grow to be the kind of organisation that can connect more than 500 million mobile money wallets across 40 African countries, supporting over 300,000 agents and providing access to financial services for millions of Africans. 

A policy worth getting right 

Ultimately, despite dire predictions from the extremes of the political landscape, it’s unlikely that ESG will go away soon.

Even if the label disappears, it’s now so entrenched in the way that investors do business, that it’ll remain an important consideration. And that’s because the companies that do ESG well share many of the hallmarks of good, investable companies.

As the African fintech sector continues to grow, its participants should ensure they’re taking a proactive and positive approach to ESG. This will transform the sector beyond “doing” good to “being” good – good for the economy, good for society and good for stakeholders.

The product is the first of its kind all-natural foaming hand sanitizer produced, manufactured, and distributed in Nigeria.

The premium hand sanitizer was launched in tandem with the commissioning of ESH’s state-of-the-art factory in Ikeja, Lagos on Tuesday, 15th February 2022.

The uniqueness of the Palm Tree Hygiene hand sanitizer comes from the alcohol extraction process which is sourced naturally and distilled from the sap of the Palm tree, without any damage to the tree and no harmful impact on the environment.

The product also moisturizes and gives off a coconut scent, helping to decongest the nasal pathways.

The premium sanitizer which has been proven to be effective in combating zoonotic germs, like viruses, parasites, and fungi is firstly certified in the UK under European standards EN1276 and by NAFDAC in Nigeria.

Speaking at the launch, Mr. Sam Awolesi, Chief Executive Officer, ESH LTD Nigeria, shared the inspiration for the product. “It is with humility and years of consistent research that we are proud to announce the launch of the world’s first foaming hand sanitizer, made from all-natural ingredients. When we started this experiment, we were equipped with industry knowledge and insights and we found that 80% of customers, whether individuals or organizations prefer foaming as opposed to gel or liquid sanitizers. It is with this learning from the health industry coupled with years of internal expertise that we’re pleased to introduce this innovative product sourced from local palm trees, fresh from nature’s palm to yours.”

Also speaking, Mrs. Sola Adebowale, Managing Director, ESH LTD Nigeria, expressed excitement on the launch. “We are extremely honored to announce such a unique product, Palm Tree® Hygiene foaming sanitizer. At the onset of covid-19, we saw the need for an all-natural sanitizer that is effective in protecting humans while also being environmentally sustainable. A product that will be instrumental in assisting health care institutions in preventing the spread of infectious viruses.

So, for three years we embarked on research to bring to the public the PalmTree® Hygiene foaming hand sanitizer. We believe that this product will cater to individuals but more so institutions that crave sanitizing products that cater to the healthcare needs of families, employees, or patients.

It is also exciting to do this whilst also creating opportunities for SMEs to scale their business. We have built a world-class factory that small and medium scale businesses can leverage to produce and package their products.”

Commenting on the sustainability efforts of ESH Ltd Mrs. Solape Hammond, Special Adviser, Development Goals and Investment, Lagos State, commended the initiative.

“It is exciting to see another business in Nigeria that is passionate about proliferating and promoting sustainable and environmentally friendly products. With the launch of the product and the commissioning of the factory, this will bring in new jobs and diversify our economic source for GDP whilst increasing the economic viability of our country.”

The state of the art factory was built with the intent to support small and medium businesses in the country by giving them access to the factory to manufacture their products.

SMEs in Nigeria are reported to employ a larger percentage of the population. Recognizing the important contribution of SMEs to the economy, ESH LTD Nigeria commissioned its full capacity factory to help local businesses package their goods for sale.

The fully fitted factory offers small businesses the opportunity to use world-class and approved equipment in their production and packaging process.

The Environmental Science Hygiene (ESH) Ltd, Nigeria is a wholly-owned subsidiary of Environmental Science group (ESG) the, in the United Kingdom with over 24 years of experience in environmental hygiene.

The company is involved in safety, workplace activity safety protection (WASP) sheets, identifying chemical hazards, and providing on-site COSHH monitoring, LEV testing, and chemical risk assessment services.

ESH Ltd Nigeria’s natural progression will be in the development and manufacturing of hygiene products and will include hand sanitizers, sprays, medicated soaps, surface/floor wipes, and disinfectants.