November 21, 2008
All of the hard work and support that has gone into this project finally materialized two weeks ago with the roll out of solar lanterns to every household in the New Keringa Village. It was truly fulfilling to see a place, that normally falls quiet at sundown, transformed into a bright, colorful and lively place within a matter of hours. The most basic benefits of the light were immediately recognizable; kids were playing in the street and parents gathered outside of the houses to socialize.
There’s so much to tell but the first thing that needs description is how we ended up structuring the program. As we’ve said before, simply giving the lanterns away is not an effective means of empowerment. We’ve learned from various NGOs in India that charity is not sustainable, the pride of ownership is reduced, and typically results in neglect of the donated products. With this in mind, Jeff and I have attempted what we can only refer to as a “micro-finance lite” model. Microfinance, or micro-credit, is the process of lending small amounts (typically less than $1000) to impoverished people for income producing activities. Micro-finance recently came into the public eye when Muhammad Yunus, the founder of Grameen Bank, won the Nobel Peace Prize in 2006 for his success in “micro lending” to poor villagers, mostly women, in Bangladesh.
What Jeff and I wanted to do was to employ the microfinance model, but without levying the high interest rates (upwards of 30%) that traditional microfinance institutions must impose. Also, we wanted to make sure that the program was available and affordable to everybody in the village.
After hours of debate and some tough negotiations with the community, we finally settled on a program. Beyond Solar has agreed to provide 0% financing for the lanterns. In return the each household agreed to a 20-30% down payment, at the time of purchase, and to make weekly installments of 25 Rupees, or the equivalent of the avoided purchase of kerosene, until the cost of the lantern is fully recovered. Every week, the treasurer from the Village Development Committee (VDC) is tasked with collecting the installment payment from each household. At the end of every month our partner NGO, South Orison Volunteer Action (SOVA) will collect the money.
This is where we diverted slightly from the traditional microfinance path. Rather than collecting the money to recirculate in different villages, Beyond Solar agreed to commit every penny collected to a Community Development fund managed by SOVA. As such, if the village achieves a 100% repayment rate at the end of the 12 months, each family will have access to a revolving credit line equal to the cost of the lantern and to be used for emergency situations or incoming producing activities.
What has been the most interesting throughout this process is that this all of the above details have to be explained to the villagers. They like the lights, but they certainly don’t understand concepts such as investment, access to capital, or payback schedules. This is where we, along with our SOVA representative, Amzad, come in – the sales pitch.
After four separate visits to the village, the final meeting was undoubtedly the most exciting so far. A little mat is laid out for us, we take off our shoes, and the show begins. We start by asking questions, getting them to think about the problems they endure as a result of kerosene. We then start talking about how much their lives can be improved with more light, how much money they can save, how much more work they can do, how the kids can study, and how safety and health can improve.
After three hours of tough questioning by some surprisingly savvy negotiators (the villagers), we ask the final question – “the close” – who wants a solar lantern? People began disappearing and returning with their down payment in hand. Purple thumbprints replaced signatures for those who could not write. After almost an hour, the five boxes of solar lanterns that we had brought were empty and every household in New Keringa was beaming with light!
The following pictures were taken throughout the night. Keep in mind that we didn’t use a flash and nothing has been edited – all of the light is coming from the lanterns that Beyond Solar has provided.