End-User Finance in Mozambique - Revision history

Fernanda Wynter at 14:50, 7 March 2022

2022-03-07T14:50:35Z

Fernanda Wynter at 14:33, 12 January 2022

2022-01-12T14:33:39Z

Ranisha at 08:39, 30 November 2021

2021-11-30T08:39:14Z

Lisafeldmann at 13:44, 8 November 2021

2021-11-08T13:44:55Z

Lisafeldmann at 13:41, 8 November 2021

2021-11-08T13:41:40Z

Lisafeldmann: /* Microfinance */

2021-11-08T13:41:16Z

Microfinance

Lisafeldmann: /* Access to Consumer Finance */

2021-11-08T13:39:30Z

Access to Consumer Finance

Lisafeldmann at 13:39, 8 November 2021

2021-11-08T13:39:14Z

Lisafeldmann at 13:38, 8 November 2021

2021-11-08T13:38:24Z

Lisafeldmann at 13:29, 8 November 2021

2021-11-08T13:29:13Z

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 {{Back to Mozambique Portal}}
 == Introduction ==
 Formal end-user finance is difficult to access for most Mozambicans due to very limited availability, especially in rural areas. Non-bank financial products such as mobile money, however, have seen a major uptake over the last five years. Launched in 2011, mobile money is used by one in every four adults.<ref name=":0">[https://drive.google.com/file/d/1TYp_gAuemR2rUVUNWeYyA2N9hG5U7qUS/view FinScope (2020): Consumer Survey Mozambique 2019.] </ref>

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 To overcome financial barriers and make energy access technologies available to different customer segments, a couple of different end-user finance approaches can be applied by companies and other stakeholders as presented in this article. However, purchasing power, budget constraints, and willingness to pay of potential customers are key variables that need to be assessed and kept in mind.
 == Access to Consumer Finance ==
-According to the latest FinScope report for Mozambique, in 2019, 21% of Mozambicans had access to formal institutions such as banks; 41% had access to other formal non-bank institutes, mainly mobile money but also including micro finance, saving and credit cooperatives, cooperatives, savings and credit operators, and pension funds; 32% had access to informal savings groups called Xitiques, and 46% did not have access to any.<ref name=":0" />
+According to the latest FinScope report for Mozambique, in 2019, 21% of Mozambicans had access to formal institutions such as banks; 41% had access to other formal non-bank institutes, mainly mobile money but also including micro finance, saving and credit cooperatives, cooperatives, savings and credit operators, and pension funds; 32% had access to informal savings groups called ''Xitiques'', and 46% did not have access to any.<ref name=":0" />
 Out of the 21% of the adult population in Mozambique that had a bank account, 41% lived in urban and 10% in rural areas. 60% of the rural population is excluded from any formal or informal financial products or services compared to one fifth of the urban population.<ref name=":1">[https://drive.google.com/file/d/159HWXz5QCupAy13Zz4K_df55QZG8jPHM/view FinScope (2020): Consumer Survey Highlights. Mozambique 2019.] </ref>
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 [[File:Access_to_consumer_finance_in_Mozambique_.png|alt=]]
 The most available and accessible are mobile money agents, which most people use or are aware of their location and only take a short walk to reach them.
 This makes mobile money the most used financial product in Mozambique, with 29% of the population having a mobile money account. This is a huge jump compared to the 3% in 2014. There is almost no difference in terms of gender, with 55% of male have access to mobile phone compared to 54% of women. The most common use of mobile money is for cash withdrawals (91%), cash deposits (81%) and cash transfer (72%). 27% use it for utility payments and 9% for goods payment.<ref name=":1" />
 === Credit Lines in Place ===
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 The credit line will be available until 31 March 2023 or until the amount available for financing (1 million USD) is reached. BCI funds up to 75% of the project or equipment to be acquired under the facility, with a max of MZN 3.5 Million and at a 7.5% interest rate.<ref>https://amer.org.mz/wp-content/uploads/2021/06/LINHA-CREDITO-BCI-SUPER.pdf</ref><ref><nowiki>https://www.bci.co.mz/bci-exclusivo-pme/</nowiki> (accessed in Oct 2021)</ref><ref>https://www.tse4allm.org.mz/index.php/en/credito-super/perguntas-frequentes-credito-super</ref>
 === Savings and Credit ===
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 According to the 2019 FinScope survey, only 7% of Mozambican adults had borrowed money in the last 12 months. 4% borrowed formally from banks, 2% informally, and 1% within family or from friends.<ref name=":0" />
 == End-user Finance Approaches for Off-grid Technologies ==
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 Another barrier for PAYGO has been the lack of clear leasing regulations for non-financial institutions. To overcome this obstacle, most companies remain the owner of the system and charge customers a fee for using it.<ref name=":2" />
 === Energy-as-a-service (EaaS) ===
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 As mentioned above, in Mozambique, this business model is used by many PAYGO companies to overcome the obstacle of lacking leasing regulations for non-financial institutions.
 === Microfinance ===
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 In Mozambique, the microfinance sector is very small and concentrates predominantly on Maputo City and Maputo Province.  High interest rates make credit from Micro Finance Institutions (MFI) very expensive. In 2015, none of the microfinance institutions (MFI) were known to have a lending programme for solar.<ref>Overseas Development Institute (2016): [https://cdn.odi.org/media/documents/10251.pdf Accelerating access to electricity in Africa with off-grid solar. Off-grid solar country briefing: Mozambique.]</ref>
 === Results-based Finance ===
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 * '''Voucher schemes''' are an alternative way of providing capital or revenue incentives for a particular product or service. Free or subsidised-fee vouchers are offered to households, which can use the voucher for accredited retailers or service providers. These companies are then reimbursed for products and services delivered. This way, vouchers are stimulating both supply and demand side.
-In Mozambique, there are several donor funded programmes and funds that provide results-based finance to energy access companies. Click [[Financing Opportunities for Energy Access Companies in Mozambique|here]] for an overview.
+In Mozambique, there are several donor funded programmes and funds that provide results-based finance to energy access companies. [[Financing Opportunities for Energy Access Companies in Mozambique|'''Click here''']] for an overview.
 == Further Reading ==
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 * [[Fee-For-Service or Pay-As-You-Go Concepts for Photovoltaic Systems]]
 * [[Results-Based Financing|Results-Based Financing (RBF)]]
 == References ==
 <references />

← Older revision		Revision as of 08:39, 30 November 2021
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		+	{{Back to Mozambique Portal}}
	== Introduction ==		== Introduction ==
	Formal end-user finance is difficult to access for most Mozambicans due to very limited availability, especially in rural areas. Non-bank financial products such as mobile money, however, have seen a major uptake over the last five years. Launched in 2011, mobile money is used by one in every four adults.<ref name=":0">[https://drive.google.com/file/d/1TYp_gAuemR2rUVUNWeYyA2N9hG5U7qUS/view FinScope (2020): Consumer Survey Mozambique 2019.] </ref>		Formal end-user finance is difficult to access for most Mozambicans due to very limited availability, especially in rural areas. Non-bank financial products such as mobile money, however, have seen a major uptake over the last five years. Launched in 2011, mobile money is used by one in every four adults.<ref name=":0">[https://drive.google.com/file/d/1TYp_gAuemR2rUVUNWeYyA2N9hG5U7qUS/view FinScope (2020): Consumer Survey Mozambique 2019.] </ref>

← Older revision		Revision as of 13:44, 8 November 2021
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	== References ==		== References ==
	<references />		<references />
		+	[[Category:Financing and Funding]]
		+	[[Category:Mozambique]]
		+	[[Category:Microfinance]]
		+	[[Category:Results Based Financing (RBF)]]

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 * [[Fee-For-Service or Pay-As-You-Go Concepts for Photovoltaic Systems]]
 * [[Results-Based Financing|Results-Based Financing (RBF)]]
 == References ==
 <references />

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 In general, microfinance is one of the most common financing concepts for small‐scale decentralized/off-grid renewable energy projects worldwide. Microfinance Institutions (MFIs) provide loans to households, communities or small businesses mainly for productive purposes or for buying products and services.
-·      Read more about microfinance in general here. [[Microfinance|https://energypedia.info/wiki/Microfinance]]
+* Read more about [[microfinance]] in general.
+* Read more about [[Financing Mechanisms for Cookstove Dissemination|microfinance for cookstoves]].
 In Mozambique, the microfinance sector is very small and concentrates predominantly on Maputo City and Maputo Province.  High interest rates make credit from Micro Finance Institutions (MFI) very expensive. In 2015, none of the microfinance institutions (MFI) were known to have a lending programme for solar.<ref>Overseas Development Institute (2016): [https://cdn.odi.org/media/documents/10251.pdf Accelerating access to electricity in Africa with off-grid solar. Off-grid solar country briefing: Mozambique.]</ref>

← Older revision		Revision as of 13:39, 8 November 2021
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 This regional imbalance is also mirrored in the fact that nearly half of the population uses or is aware of the next Automated Teller Machine (ATM), and of those who use or know it need 45 minutes mean time to reach it (mainly by walking). Similarly, almost three quarter of the people use or are aware of the next bank agency, which is at a 45 minutes mean time distance<ref name=":1" />.
-[[File:Access to consumer finance in Mozambique .png|left|Access to consumer finance in Mozambique. Source: FinScope (2020): Consumer Survey Highlights. Mozambique 2019. ]]
+[[File:Access_to_consumer_finance_in_Mozambique_.png|alt=]]
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 According to the 2019 FinScope survey, only 7% of Mozambican adults had borrowed money in the last 12 months. 4% borrowed formally from banks, 2% informally, and 1% within family or from friends.<ref name=":0" />
 == End-user Finance Approaches for Off-grid Technologies ==