Green transition-focused non-banking finance company Ecofy Finance has secured a $12.5 million (~₹1.07 billion) long-term loan from Denmark government’s Investment Fund for Developing Countries (IFU).

Ecofy will utilize the funds to expand its loan portfolio for electric vehicles (EVs) and rooftop solar systems. A portion of the financing will be directed towards aiding individuals and small and medium-sized enterprises who lack funding to become green consumers.

Axis Bank was the exclusive financial advisor to Ecofy for this transaction.

The financing from IFU is part of the green strategic partnership between India and Denmark established in 2020.

Ecofy plans to finance over 1 million EVs and more than 1.5 GW of rooftop solar within seven years.

The company’s green transitioning efforts aim to support the decarbonization of India’s transportation sector and power consumption of households and small and medium businesses.

Vivek Khandelwal, Treasury Head, Ecofy, said, “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.”

IFU provides risk capital to companies operating in developing countries and emerging markets across Africa, Asia, Latin America, and Europe. It invests on commercial terms through equity, loans, and guarantees.

IFU has co-invested in over 1,300 companies in more than 100 countries. The fund’s capital under management is expected to grow from Є2.1 billion (~$2.27 billion) to Є5.0 billion (~$5.4 billion) over the next few years.

EV sales in India reached a record 1.95 million units in 2024, an over 27% growth year-over-year against the 1.53 million units sold in 2023.

In January 2025, Ecofy secured an investment of ₹900 million (~$10.83 million) from FMO, a Dutch entrepreneurial development bank, to facilitate product diversification and support its expansion across India.