• Debt funding rose to $1.64 billion in 2025, a record for Africa
• Debt accounted for 41% of total start-up capital invested
• Kenya led debt funding, followed by Egypt and Nigeria

Debt financing for African startups rose sharply in 2025, both in value and number of deals, while equity funding remained broadly stable.

The annual 2025 report by Partech Partners on venture capital in African tech, published on Jan. 22, shows that debt funding increased to $1.64 billion at the end of 2025, from $1.01 billion a year earlier. This represents a 63% year-on-year increase. The number of debt-funded transactions followed the same trend, rising from 77 to 108 deals, a 40% increase. Partech said this was the highest level ever recorded on the continent.

In 2025, debt represented 41% of all capital invested in African start-ups, up from 31% in 2024 and 17% in 2019. With about $1.6 billion deployed across 107 transactions, debt accounted for nearly half of the total capital raised by these companies during the year. This reflects a steady upward trend since 2021, when African start-ups raised $767 million exclusively through debt. The amount then rose to $1.55 billion in 2022, before easing to $1.21 billion in 2023 and $1.01 billion in 2024.

Growing maturity of African start-ups

Partech Partners said the rise in debt funding does not reflect a cyclical rebound, but a lasting shift in financing models. African start-ups are increasingly turning to structured, non-dilutive instruments, with debt becoming a central component of tech financing in 2025.

This trend reflects the growing number of start-ups reaching sufficient levels of scale, cash generation, and governance. These factors allow them to access debt financing without diluting founders’ equity. Another key point is that the increase in debt explains a large share of the overall rise in total funding in 2025. Without debt, overall volumes would have remained close to the previous year’s level.

“We saw debt emerging as the most structural shift of the year. Debt financing grew sharply, surpassing the 2021 peak. From an emerging instrument just a few years ago, debt is now becoming a core pillar of the African tech financing landscape,” Partech said in the report.

Sharp differences across markets

The geographic distribution of debt funding highlights clear gaps between Africa’s main start-up ecosystems. In 2025, Kenya led with $498 million raised through debt. It was followed by Egypt with $246 million, Nigeria with $160 million, Senegal with $139 million, and South Africa with $72 million.

In Kenya, debt accounted for 48% of total capital deployed and increased 30% year on year. Half of the mega-deals recorded in the country in 2025 were structured as debt. Egypt showed a more balanced profile. Debt represented 20% of total funding, with volumes up 73% from the previous year.

In Nigeria, debt remains secondary but is gaining visibility. It accounted for 19% of funds raised, with a 132% year-on-year increase. It supported higher volumes without changing the overall market structure. In South Africa, debt played a limited role, representing just 10% of total start-up funding in 2025, with volumes down 45% year on year.

The rise of debt financing is reshaping Africa’s venture capital landscape. It reflects the growing maturity of start-ups and opens up new options for investors.

Chamberline Moko