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Kenyan solar lighting solutions on sale via M-Pesa

bobcollymore

Subscribers of Kenya's leading mobile operator Safaricom can purchase solar home lighting solutions on hire purchase via mobile money transfer service M-Pesa.

This move comes after the telco has partnered with mobile technology startup, M-Kopa, to provide clean energy to a targeted 3 million people.

The United Nations Environment Programme (UNEP) estimates that a paltry 18% of households in Kenya have power, while the rest of the population uses kerosene.

To access the light solar home system, dubbed ‘d.light’, subscribers have to make a 2,500 shillings ($31) deposit and pay daily installments of 40 shillings ( $0.50) via M-Pesa for one year.

In total, the M-Kopa solar solution costs 16,900 shillings ($200) . Users who default on payments will be denied services since the GSM enabled pay-as-you-go solar solution is embedded with Safaricom sim cards which can switch off the lighting .

After the one year payment period, users will continue using the solar system for free. The product has a lifespan of 7 to 10 years.

“The barrier to large-scale adoption of solar lighting has been the high upfront cost of a home system which makes it unaffordable to the majority of Kenyans,” said Safaricom chief executive Bob Collymore.

“Indeed, the penetration of solar lighting products in Africa as a whole remains at less than 2%. M-KOPA Solar has been developed to remove this barrier by making solar home systems affordable and accessible to low income consumers,” Collymore added.

The d.light solar home system combines three bright bulbs and a mobile phone charging, suiting the needs of its targeted market of low income households in rural areas which rely on kerosene for lighting. Safaricom is also seeking to reach rural based mobile phone charging bureaus which serve communities that have no access to electricity.

About 3 million people in rural Kenya spend one dollar a day on kerosene and mobile charging fees since they cannot afford the $400 electricity connection fee.

The M-Kopa solar has been rolled out in 75 shops in the agricultural towns of Eldoret and Kitale. Plans are however underway to deploy 250 dealers in the North Rift, Nyanza and Western parts of the country this year ahead of a planned 2013 countrywide expansion.

M-Kopa hopes to borrow on the 'bottom of the pyramid' approach of M-Pesa which has seen the service grow popular among poor rural communities that lack access to formal financial services.

“As with M-Pesa, M-Kopa has been designed specifically to suit the needs and budgets of Kenyan consumers. By working with Safaricom, a world leader for mobile innovation, we can spread this new service to all parts of Kenya,” said M-Kopa chairman, Nick Hughes.

The company plans to sell the solar system to 'tens of thousands' users by the end of this year.

"We have over 1,000 customers in Kenya already, with a wide majority telling us how good it feels to save money while getting far better lighting than with kerosene and the convenience of mobile phone charging at home. We look forward bringing better lighting at lower cost to tens of thousands of homes over the coming year." said Jesse Moore, managing director M-KOPA.

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