The lack of access to end-user financing is one of the biggest obstacles to the spread of solar home systems to the 200 million energy poor households and small businesses in India. These consumers spend a large portion of their incomes on energy sources such as kerosene, and the banking system often doesn’t reach them because they own no land, have irregular incomes, or lack formal identification.
To address this problem, Simpa Networks has invented, built and field-tested a new pay-as-you-go pricing model for non-banking households. This “Progessive Purchase” pricing solution combines hardware that is embedded into a solar system, with software that enables a consumer to use mobile phone money or scratch cards to buy prepaid energy credits as needed. These function as payments towards the purchase of the system. The model is already used successfully in several informal settlements around Bangalore.