Over the next five years, Google will invest $1 billion in Africa to build a subsea cable.

On Wednesday, Google announced a $1 billion investment in Africa over the next five years to ensure that the continent has access to fast and affordable internet, as well as backing companies to accelerate the continent's digital transformation.

The announcement was made during a virtual event in which Alphabet Inc announced the formation of an Africa Investment Fund, through which it will invest $50 million in businesses and provide them with access to its staff, network, and technologies.

Nitin Gajria, managing director of Google in Africa, told Reuters in a virtual interview that the company would seek startups focused on fintech, e-commerce, and local language content, among other things.

"We're looking at places where Google and these businesses may have some strategic overlap and where Google might potentially bring value by working with some of these startups," Gajria added.

In addition, Google will also contribute $10 million in low-interest loans to small businesses and entrepreneurs in Ghana, Kenya, Nigeria, and South Africa., in conjunction with non-profit group Kiva, to assist them get through the economic hardship caused by COVID-19.

Small enterprises in Africa frequently face difficulties obtaining funding because they lack the necessary collateral required by banks in the event of a default. When financing is accessible, the interest rates are frequently exorbitant.

Google announced that a programme launched last year in Kenya in cooperation with Safaricom that allows customers to pay for 4G-enabled phones in instalments will be expanded across Africa alongside mobile operators MTN, Orange, and Vodacom.

Gajria said, a Google-built undersea cable connecting Africa and Europe should  come into service in the second half of next year, and is expected to increasing internet speeds by five times and lowering data costs by up to 21% in countries such as South Africa and Nigeria.