Part of my role at blueEnergy is to manage our two loans through our local microfinance institution. Who would have thought a portfolio of a little over $1,200 would be so challenging?
Earlier in 2009, blueEnergy received funds to subsidize individual solar systems for two communities: Set Net Point and Monkey Point. The donors and individual borrowers covered the large majority of the individual systems.
The exchange sounds easy enough: each borrower pays $67 over 12 months and they receive a small solar panel, batteries and enough power for three light bulbs.
Our difficulties: Organizing a community where members live two hours away in dense jungle accessible only by a panga boat, the average income can barely cover payments, and friction (sometimes between ethnicities) between members can slow repayment progress. These are just a few, but slowly, we are working through them.
I believe these community members deserve the opportunity for credit and energy. But how can we implement it successfully? When people talk about the bottom of the pyramid, more often then not, they need to dig a little deeper and then the Nicaraguan coastal communities come into picture.
April Allderdice, founder of MicroEnergy Credits of Seattle, co-authored a very informative study on renewable energy and microfinance through The Small Enterprise and Education and Promotion (SEEP) Network. I couldn’t agree more with April about the need and potential for renewable energy and microfinance. She argues that we need to reach the poorest of the poor. I challenge April and those professionals to dig deeper and think poorer. Take away your roads and think about how the community can generate any income at all. But does this mean these community members don’t deserve access to credit? Where does microfinance say yes, and possibly no?
No roads. Little income. No energy. No prior credit access. 50 miles away on the ocean from the nearest urban center.
blueEnergy is committed to act as the NGO liaison between our local microfinance institution, the community members and Kiva to help repay these loans and build capacity with the borrowers. The biggest reason is that they WANT these systems. I personally visited the borrowers of Monkey Point and witnessed families of 10 cooking together under the light that their solar system powered. Otherwise, they would be literally left in the dark.
We welcomed Matt Flannery, Founder and CEO of Kiva, to blueEnergy last month for our Board of Directors meeting. Matt and I discussed these loans and their difficulty, but also the need to provide them to the poorest of the poor, the most rural. Matt tweeted after his trip to Monkey Point, “Visited borrowers in village of Monkey Point. Struck by how important it is to do microcredit in remote places.” Kiva’s support is immense and we hope that larger players in the microfinance network continue to offer their assistance for extremely rural borrowers.
blueEnergy is at the forefront of providing renewable energy and facilitating microloans to some of the most rural and poor inhabitants of Latin America. We are building internal capacity with these loans and learning along the way.
We’d love to hear about success stories for rural, microenergy borrowers as we continue to navigate through a subject at the forefront of development.
Brett Veerhusen is currently living in Bluefields, Nicaragua as the Controller for the blueEnergy Group. Stay updated by following Brett on Twitter or La Vida Idealist on Twitter.
Latest posts by bveerhusen
- Nicaragua to Alaska: An Unlikely Duo - June 15th, 2010
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- Productive Uses Create Sustainable Energy - April 9th, 2010
- Pan Doesn't Only Mean Bread - March 19th, 2010
- I’m on a Boat: Joys and Sorrows of Pangas - March 5th, 2010
- The Experience: Enjoying Your Time as a Volunteer - February 4th, 2010
- Nica is Cash Only - January 19th, 2010
Yes, it is difficult when we first need to examine how these borrowers can generate enough income to pay for these systems as well as the transportation difficulties. April’s article illustrates some success, and not so successful, examples, but I still don’t think the authors took it one more step to the extreme. “Dig Deeper” is key!
Having visited microfinance loan recipients in Nicaragua (including some who bought solar panels in the Achuapa area) as well, I couldn’t agree more with your line asking people to “dig deeper and think poorer” when they think about how best to work with this type of client.