Malawi’s solar micro-finance initiative builds business for women entrepreneurs

“I have ten solar panels and these charge LED lamps that people use in their houses in the evenings – I rent them by the day. I’ve had lots and lots of orders from people and the local school wants to buy my whole stock of solar panels then next time I get some more,” said Veronica.

MicroLoan lending process  

With the “feminization of poverty”, lending to women has become a common practice in the Microlending circuit, as 75% of microcredit recipients worldwide are women. The MicroLoan Foundation provides loans to groups that include 10-18 women.

Each group has its business ideas appraised and receives eight training sessions covering topics such as book keeping and cash flow. All group members are required to save money as a source of security. Each woman receives her loan as a check and opens an account at a designated bank.

Individuals in the group then establish small commercial ventures. Groups meet with a loan officer every two weeks to review their progress. Repayments against loans are made routinely by each group member. When business is booming, it is the responsibility of the loan officer to ensure things get back on track.

Loans typically last for four months. Each group member is eligible to receive up to four loans after which their business should be commercially viable. Loans are small – on average £67 ($105 USD) per individual and an interest of 20% is charged in keeping with the local economy. For individual’s desiring to develop a business further they may receive a bridging loan of £140-£350 ($219-$547 USD) or access a separate MicroVentures service.

The loaning program operates on a continual gifting cycle: when the women repay their microloans, the money is then given to another woman. This process repeats itself.

MicroLoan has now set up a total of nine women as solar entrepreneurs in and around the Kasungu area.  The women have been selected on the basis of their successful business backgrounds and their ability to sell new products.

“MicroLoan Foundation is passionate about the change that solar energy can bring to the lives of the poor. With a large client base of women, along with a light yet efficient commercial touch, we are uniquely placed to roll this out,” said  Peter Ryan, MicroLoan’s Founder and CEO.

The women generally attend a two and a half day training workshop in Kasungu where they learn how their panels work, how to repair faulty units, how to charge clients mobile batteries, how to find clients and how to keep accurate record of their sales.

“The impact it has brought to our clients, their families and their communities has been fantastic. There have been so many positive benefits including children now being able to study in the evening, women generating a new income and being able to travel much less to conduct their business by relying on a now fully charged mobile phone,” said Mele.

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Microfinance success for women in the Africa region is still happening. Women entrepreneurs in Malawi have been receiving assistance from the MicroLoan Foundation for over a decade. With training in business concepts women can build sustainable businesses using ingenuity as they become more self-reliant and empowered to choose new careers reaching greater levels of public participation in their local regions. This short 2:55 min 2008 video has been produced by the MicroLoan Foundation UK.

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For more information on this topic:

• “The Role of Women in Sustainable Energy Development,” Elizabeth Cecelski – Energy, Environment & Development Germany for the National Renewable Energy Laboratory, June 2000;
• “Off-grid energy services for the poor: Introducing LED lighting in the Millennium Villages Project in Malawi,” ELSIVIER Journal with UNDP – United Nations Development Programme Millennium Development Project – Malawi, Colombia University and Earth Institute and the School of Engineering and Applied Science, December 2009;
• SolarAid Malawi website;
• “Concept Paper for the Energy Sector – Public Private Partnerships on Electricity Generation for Rural Areas,” Malawi Government Country Office – Millennium Challenge Account, February 2010.

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An avid community organizer, WNN advocacy intern Jessica Buchleitner possess a strong desire to change the world starting at the community level. Advocating for global women’s rights in 2009, Buchleitner compiled her upcoming book, “50 Women” for The 50 Women Project includes interviews with fifty women from thirty different countries. “The book covers stories of women’s strength and perseverance,” says Jessica. In addition to publishing on WNN, Buchleitner has also been a contributer to The Western Edition San Francisco and The San Francisco Chronicle.  ”I have always believed the heart of all global communities lie with women.”

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Additional information for this story has been provided by Seva Foundation, Malawi (Gov) Country Office, UNDP – United Nations Development Programme, the National Renewable Energy Laboratory, SolarAid and MicroLoan Foundation UK.

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