Ecofy Finance Private Limited, India’s green-transition-focused NBFC, today announced it has secured a USD 12.5 million long-term loan facility from the Investment Fund for Developing Countries (IFU), a development finance institution owned by the Government of Denmark.

Ecofy aims to address the critical last-mile climate finance gap in India's consumer, transportation and small business sectors. With ambitious targets, the NBFC plans to finance over 1 million electric vehicles and more than 1.5 GW of rooftop solar within the next 6-7 years.

This will support decarbonisation of the transportation sector and power consumption of households and small businesses in India. The electric vehicles financed through Ecofy will reduce a range of harmful air pollutants caused by fossil fuel vehicles.

A part of the financing provided by IFU would be directed towards individuals and SMEs, who typically find traditional financing channels less accessible and therefore to a large extent are excluded from acting as green consumers.   

Vivek Khandelwal, Treasury Head at Ecofy, said, “This investment is a pivotal moment for both, Ecofy and the green finance ecosystem in India. The long-term capital provided by IFU empowers us to scale our climate-focused lending solutions while breaking down barriers for underserved borrowers. By combining innovative financing models with a strong commitment to sustainability, we aim to enable access to electric vehicles and rooftop solar, and to drive systemic change toward a cleaner, more inclusive economy.”

Vibhor Singhal, Investment Manager at IFU, said “IFU is very pleased to support Ecofy in its pursuit to provide accessible climate finance to the masses. This investment aligns well with IFU’s strategy, as India is a core focus country and climate mitigation and access to finance are key impact priorities for IFU.”

The financing from IFU, structured as long-term debt capital, is part of the green strategic partnership between India and Denmark, which was established in 2020 when the prime ministers of both nations signed the agreement.