Innovative Consumer Finance Mechanisms for Small Scale Off-Grid Energy

Efforts to provide energy access on a commercial basis to rural populations in developing countries face a range of challenges, including access to finance. Off-grid customers from lower income communities currently pay a high price for purchasing kerosene for basic lighting services and switching to renewable energy based systems would not only save them fuel-costs but also improve their overall quality of life. However, the high upfront cost of the renewable energy based systems (handheld devices and stand-alone systems) restricts them from making this switch. This is identified as a major barrier by all stakeholders committed to the delivery of energy access solutions in a commercially viable manner and at scale. Over the past decade, microfinance institutions, supported by the international development community, have played an important role in providing direct consumer finance for purchase of handheld devices and single home solutions. In addition to microfinance, a number of other innovative end-user finance schemes have emerged in recent years. Building on the findings from USAID’s Renewable Energy Microfinance and Microenterprise Program (REMMP), and specifically the experience of Arc Finance, this 3 weeks long e-discussion featured and discussed a number of mechanisms for downstream end-user finance and their integration into innovative energy access business models including pay-as-you go technologies, crowd funding, microfinance, remittances, and asset finance. See summaries of the discussions and recordings of the webinar ►