fbpx
Back to all news

The power of business: Unlocking local potential through cooperatives

Jamie McCloskey

 

“The developing world is full of entrepreneurs and visionaries, who with access to education, equity and credit would play a key role in developing the economic situations in their countries.” 

This was said by Muhammad Yunus, the leading pioneer for modern microfinance. His work through the Nobel Peace Prize winning Grameen Bank has shown there is more than just traditional charity for the world’s unbanked population. 

This same ethos runs through SolarAid’s DNA. We do not just believe in the power of solar, we believe in the power of business. Many times when speaking on behalf of SolarAid, I will be asked, ‘so you actually sell solar lights? Why not just give them away?’ 

While adopting a business based model is a more sustainable and scalable way to achieve impact, on an ethical level, we believe people within their own country should be positioned to affect change. We make it possible for the entrepreneurs and visionaries, as described by Mr. Yunus, to play a key role in developing their countries.

Today is the International Day of Cooperatives and it is an opportunity to update you on two active programmes which embodies our ethos:

We have worked with cooperatives for many years. Within this context, a cooperative is a group of people who save money together to take loans from their collective savings for business activity. 

The Mayi Walas: ‘Shining Mothers’ in Chichewa, is a programme working with existing cooperatives of women in rural Malawi to support them and provide credit so they become thriving solar entrepreneurs and successfully sell in last mile areas we have struggled to reach. 

Research from organisations such as ENERGIA shows women’s involvement in the distribution of solar lights can not only be a powerful driver for their own lives and agency but a more effective method of selling within rural communities. 

We will soon have 40 cooperatives signed up. Five groups have already. Below is a video of our first introduction to one of the groups. 

 

FEBCO: Frustrated with the lack of available, flexible and fair finance from the banking sector, we have set up our own cooperative. It is known as FEBCO which stands for ‘Financing Energy Businesses Cooperative’. 

The Super Agents we work with in Malawi run their own solar businesses. Our role is to ensure their businesses grow to their potential and collectively cover 100% of Malawi when scaled fully. They have invested their own capital into growing the businesses but growth is limited without access to further finance. 

With no suitable option, we decided to do it ourselves – much in the same vein as Mr. Yunus with his first research project in 1976. FEBCO is Malawi’s first energy related cooperative. It is for the Super Agents, run by the Super Agents. 

The launch of FEBCO was delayed by COVID-19. Full registration with the relevant government bodies has now been completed and the first loans will be given out in the coming months. 

Expect to read more when this happens and also the launch of the ‘How-to’ guide we have written with the Global Distributors Collective as part of the Innovation Challenge we won for this concept.

We have partnered with Lendwithcare, CARE International’s Microfinance arm, on both programmes to get the best possible finance to the entrepreneurs we are working with.

Our place is not to force change, we are here to create the conditions to unlock potential. 

Our mission is to light up every home, school and clinic in Africa by 2030. 

Let’s make it happen the right way.