Solar for MFIs
Power outages at MFIs’ headquarters and branch offices generate countless manpower hours lost, high overhead costs, low employee morale, a short shelf-life for office equipment and other low efficiencies in daily operations. Additionally, many MFIs’ local branches are completely void of any power source.
With reliable electricity, Microfinance Institutions can:
• Streamline banking functions to better manage loans and reduce overhead.
• Maintain consistent access to financial software programs to ensure reliability and organization of information.
• Implement a centralized and efficient information management system.
• Communicate with microfinance communities worldwide.
Additionally, working directly with MFI partners and clients, SunPower Afrique will develop a ‘Solar Loan Program’ that provides access to loans and trained local workers to install small-scale solar energy systems to increase the capacity of small businesses.
An MFI client selling pagnes (West Africa cloths). With a solar panel, she can power a telephone booth and earn more income from her business, such as this MFI client:
Microfinance
Togo hosts a dynamic and well-organized microfinance community. Microfinance, the provision of very small loans and other financial services to the poorest of the poor, is a proven strategy that empowers the world’s poorest people to pull themselves from poverty by starting, expanding or sustaining very small businesses.(1)
SunPower Afrique will partner with individual Microfinance Institutions (MFIs) and the National Association of Microfinance Institutions to provide solar power to MFIs’ rural branches and to educate populations about renewable energy. Working together with MFIs, SunPower Afrique will work to display the benefits of solar energy through their existing outreach networks, distributing knowledge of solar energy throughout the country and providing the financial services to install it.
One of the largest obstacles to the use of solar energy is its high startup cost. Microcredit represents an opportunity for all people to be able to afford and use solar energy. An inherent connection exists between the microfinance sector and solar energy. Both rest on ideals of long-term growth and self-sufficient development, and can mutually benefit from the products and concepts that each other offer.
SunPower Afrique’s goal is to bring solar energy to Togo in a way that will make it affordable for MFIs. SunPower Afrique will implement a payment schedule based on the model used by microfinance institutions. This system will reinforce existing MFI loan management systems and ensure successful repayment.
Eventually, microfinance clients will be able to take small loans directly from their MFIs to install solar modules that would help supply electricity to their own homes and businesses. Microfinance clients in West Africa are generally poor women or men, looking to start or increase the capacity of privately-owned, small businesses. With the income generated by their enterprises, microfinance clients boost local economies and increase the quality of life of their families and communities.
