As long as Kenyans keep making payments, the system provides light and power; once it is paid off, owners get power for free.
(Images: M-KOPA Solar)
• Jesse Moore
Managing director, M-KOPA Solar
+254 711 071 000
A pay-as-you-go solar start-up in Kenya is providing a cheap and pollution-free replacement for the common kerosene-fuelled lamps usually used in the country.
M-Kopa Solar, a mobile technology group, is providing credit to low-income earners in Kenya to buy the power system, the d.light solar home system, which otherwise is too expensive for them. Using embedded sim cards enabled by East African telecommunications company Safaricom, M-Kopa enables the use of the d.light solar home system in rural areas.
M-Kopa means “to borrow” in Swahili. The company was established in 2011 but began offering the product commercially in June 2012; since then it has sold 1 000 units. Managing director Jesse Moore said the target was to reach sales of tens of thousands of units within a year.
Kerosene lamps, indoor pollution
The majority of people in rural Kenya use kerosene-fuelled lamps for lighting their homes, which is not only hazardous and expensive, but also creates indoor pollution. About 80% of households rely on kerosene for lighting because they are not linked to the national electricity grid, which does not reach many rural communities and requires a connection fee of at least 35 000 shillings (about $412).
Solar lamps work anywhere the sun shines. The d.light solar system has a lifespan of seven to 10 years. It consists of a four-watt rooftop solar panel; a control box that attaches to the wall of a home or business; three bright, adjustable lights; a mobile phone charging station; and a base station that manages and displays the user’s credit.
According to the World Health Organization, inhaling fumes from fuels, including the coal and biomass used to power stoves and lamps, has the same effects on health as smoking two packets of cigarettes a day. “We are giving people a modern, cleaner and longer-lasting technology for less than what they would spend on kerosene or another inefficient substitute,” Moore said.
Kerosene lamps cost about $0.65 a day and people have to pay fees to have their mobile phones charged at places that have electricity. By comparison, M-Kopa’s solar system is significantly cheaper. It costs 16 900 shillings ($199). Clients make a down payment of 2 500 shillings ($29) and then daily instalments of 40 shillings ($0.46) until it’s paid off.
As long as they keep making payments, the system provides free light and power; once it is paid off, owners get power for free.
In its research, M-Kopa heard from George Miruka, a 36-year-old father of four. He told the company he had stopped worrying about the fire risk from kerosene lamps after outfitting his mud-walled hut with an M-Kopa system last month. “My children are safe,” Miruka said.
He sterilises an operating theatre and cleans a local hospital for a living in Oyugis, outside Nairobi, for which he earns 5 000 shillings ($58) a month. “The solar system works when I have credit in my account, so I make bulk payments to ensure the system always keeps going,” Miruka said told M-Kopa. “I have 264 days remaining to complete my payment.”
Easy mobile payments
Payments for M-Kopa are processed through a mobile phone money transfer platform known as M-Pesa, developed by Safaricom.
Moore said this platform allowed M-Kopa to tap into M-Pesa’s 15-million customers, comprising almost a third of Kenya’s population. This way, the payment records can be used by banks as a credit history when account holders apply for loans or mortgages.
“An estimated 33% of Kenyans are financially excluded and do not have savings accounts, credit cards or access to loans,” Moore said. The company was considering offering other pay-as-you-go products in developing countries, including irrigation systems, refrigerators for shop owners to cool drinks and food, as well as sewing machines.
M-Kopa is available in 75 shops in Eldoret and Kitale, but the company has plans to expand nationwide.