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2 August 2017

MTN partners with Fenix International to launch off-grid solar in Zambia

MTN extends relationship as Swedish Embassy and USAID contribute over $3 million to new market launch and scale-up.

Children watching TV. Source: Fenix International

Africa’s largest telecoms company, MTN, is extending its partnership with energy and financial services firm Fenix International to launch pay-to-own solar home systems in Zambia.

The venture-backed energy and financial services company said in a statement that the Swedish Embassy in Zambia is committing nearly $3 million to Fenix in Zambia between now and 2020, with USAID contributing an additional $750,000 to the company.

Off-grid solar in Zambia

According to Fenix, an estimated 15 million Zambians live without access to the electrical grid, representing 80% of the total population and 95% of rural residents.

The launch in Zambia represents the first step in Fenix’s expansion across Africa with their ReadyPay Power product – an expandable, pay-to-own home solar system financed through ultra-affordable instalments over Mobile Money.

With backing from the Swedish Embassy and USAID, Fenix expects to reach 850,000 rural Zambians by 2020.

How it will work

The payment platform  is an expandable solar home system designed to provide power to households and small businesses that the grid has failed to reach.

Customers make instalments of as little as $0.20 per day via MTN Mobile Money until they have paid in full.

Fenix uses these continuous micro-payments to generate a credit score, enabling customers to access additional system upgrades or financial services.

Lyndsay Handler, CEO of Fenix International, commented: “Over 90% of rural Zambians lack access to electricity and have no options other than dangerous candles and kerosene lanterns to light their homes.

“This is the harsh reality of the situation which we are working to change. Our solar home systems not only provide light and energy, but our unique Fenix credit score makes upgrades and additional life-changing products accessible to committed customers as their needs and incomes grow. Ten years from now, we hope to eliminate the use of candles and be an important part of our customers’ lives across Zambia.”

Wane Ngambi, Head of Mobile Financial Services, MTN Zambia, adds: “My colleagues in Uganda have been blown away by the growth they’ve witnessed with the ReadyPay system.

“In the past, MTN was focused on voice, and then data. We’ve been working on unlocking the potential of MTN Mobile Money for many rural consumers who have gone without access to basic financial services for far too long.”

Strong partnerships

Ngambi added: “The transformative relationship between MTN Mobile Money and off-grid energy has been an exceptional revelation. MTN Mobile Money now sits at the heart of many households, who use these simple and secure services daily to light up their lives. For us, this is all part of the mission to create mobile solutions which make a difference.”

Lyndsay agreed: “With MTN’s distribution networks, we’ll be able to reach unbanked and off-grid customers. Once power and credit are established, the possibilities to bring other life-changing products – from smart phones to financial services – are endless.”

Funding from the Embassy of Sweden in Lusaka is provided as part of the Power Africa: Beyond the Grid Fund Zambia (BGFZ) initiative. This is managed by REEEP (the Renewable Energy and Energy Efficiency Partnership).

BGFZ aims to bring basic clean energy access to 1 million Zambians and accelerate private sector growth in clean energy generation and distribution in the country.

USAID’s additional $750,000 support is provided as part of its Scaling Off-Grid Energy: Grand Challenge for Development, which aims to create up to 120,000 new connections in off-grid communities across Africa.

 

Featured image credit: Fenix

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