Using Microfinance to Expand Access to Energy Services
The potential for microfinance institutions (MFIs) to offer profitable loans to purchase energy services, and thereby help alleviate poverty and promote modern, efficient energy use, has not yet been realized due to lack of experience by both the energy and microfinance fields and the lack of documented successes.
In order to better understand this emerging arena, the Citi Foundation and United States Agency for International Development funded a comprehensive study on the opportunities, barriers, costs, and impacts associated with MFI lending portfolios that have integrated energy lending into their products.
This action research by Sustainable Energy Solutions and the SEEP Network offers a detailed look at the business models, the clients, and the operations of selected MFIs in Asia, Africa, and Latin America and the Caribbean that currently have energy-lending programs.
The goals of the study are to offer initial recommendations for project implementation to the global financial service community, energy companies, donors, and policy makers, highlight lessons to learn from, and identify areas that warrant further attention for using microfinance to improve access to energy services.