As part of its various partnerships, particularly with ADEME and the African Development Bank, CIDR Pamiga rolls out microfinance products in Africa that provide access to solar solutions to as many people as possible.
Just imagine: households and micro-businesses that can reap the benefits of electricity that is produced independently and at no cost, thanks to the sun. It’s a radical change in countries where access to electricity is not available everywhere, where bills can be very high and infrastructures are not always in great shape, leading to frequent outages with serious consequences.
CIDR Pamiga has been working in the field since 2013, in Ethiopia, Senegal, Kenya, Benin and Cameroon, to roll out solutions in partnership with local actors, primarily MFIs from its network. One of these innovative solutions is a Pay-As-You-Go system. Solar kits, fitted with meters, are sold on credit. Users make regular payments into their account to keep the kits operational, and to repay their loan. They no longer have to pay upfront for a solar system.
A facilitator role
The product was the fruit of an innovative model developed by CIDR Pamiga that combines the skills of solar power kit distributors with the financial expertise of MFIs. The distributors have the technology, the MFIs understand credit and how to manage risk.
“Our aim is to roll out models that are profitable and sustainable economically, socially and environmentally, as well as being self-financing,” explains Umberto Trivella, who leads the programme for CIDR Pamiga. “Using financial support from our partners, we test the models, checking that they work and are sufficiently robust to flourish when faced with the realities on the ground, so that they can then be scaled up.”
For the Pay-As-You-Go system, CIDR Pamiga acted as go-between for the two parties, creating a win-win model. The solar kit distributors benefit from MFIs’ credit management skills. And the MFIs make access to credit easier by asking clients for fewer guarantees, helped by the fact that kits can be disconnected if bills go unpaid.
And the end users are winners too: greater numbers of people can now afford solar equipment, and they also spend less on kerosene, candles and torches.
“I’m so proud. I have electric light, just like people in towns. My neighbours come to visit in the evenings and we can talk away without being troubled by smoke from kerosene lanterns,” says a delighted client from Cameroon.
The next location for rolling out PAYGO solar kits is the island of Madagascar. CIDR Pamiga has just begun work in the country, using lessons learned from earlier operations, notably in Benin.
The project in figures
Solar solutions supplied
MFIs involved (Benin, Senegal, Cameroon, Kenya and Madagascar)
%
Saving each month for households using solar kits
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