Appliance Financing 3.0 Mini-Grid Innovation Insight – CrossBoundary Innovation Lab
Cheap, reliable power from mini-grids enables income-generating activity and is driving consumption, finds CrossBoundary’s Mini-Grid Innovation Lab in their latest Innovation Insight: Appliance Financing 3.0.
CrossBoundary’s Innovation Lab funded developers who deployed 326 income-generating machines on credit to customers across 25 sites in Nigeria, Kenya, and Tanzania.
Appliance financing 3.0 focused on income-generating equipment: electric pressure cookers, freezers/fridges, and grain mills were the appliances with the highest demand. Previous iterations of the appliance financing prototype showed that household appliances do not increase consumption.
However, customers covering a specific need in a community tend to generate a disproportionate demand for electricity resulting in significantly higher consumption.
In fact, the top 20% of appliance financing customers consume at least 16x more than their peers. This top 20% of appliance financing customers utilize equipment or machinery that meets specific community needs e.g. tailoring.
The results also showed that appliance financing allows customers to increase their consumption sustainably over a prolonged period of time, despite economic shocks.
CrossBoundary’s Mini-Grid Innovation Lab, part of CrossBoundary Group, is Africa’s first R&D fund exclusively focused on testing new business model innovations for mini-grids, designed to close the gap on the 618 million Africans who do not have power. The Mini-Grid Innovation Lab works with developers across the continent to test innovations to make mini-grids a more reliable and commercially viable solution.