The FINANCIAL — Babyloan, one of the European leaders in crowdfunding*, and Total have teamed up to develop the first crowdfunding platform dedicated to access to energy. The partners are aiming to accelerate access to energy and related financing solutions, particularly in Africa, Asia and Latin America, where the need is greatest.
Worldwide, 1.3 billion people do not have access to electricity and 2.7 billion do not have access to clean cooking options. While effective solutions exist, they are hard to access or unaffordable for people living in rural or near-urban areas, who spend a large portion of their inadequate income on sources of energy unsatisfactory for the environment.
By creating a crowdfunding platform dedicated to access to energy, Babyloan and Total are combining their respective expertise — in crowdfunding and microcredit for Babyloan and in access to energy projects for Total, through its Awango by Total lineup of high-quality solar lamps mainly distributed in Africa. The collaboration will support the creation of local microbusinesses that will develop distribution networks to cover the last mile to reach isolated communities, according to Total.
Babyloan’s crowdfunding ethos is distinctive. Working with microfinance institutions (MFIs), it ensures that the money raised for a project is paid directly to a local MFI, which provides microcredit to entrepreneurs. This system offers better familiarity with the local economy and support for projects on the ground.
“Crowdfunding offers huge potential for developing access to energy projects,” says Arnaud Poissonier, Chief Executive Officer of Babyloan. “There aren‘t very many projects yet, but those that exist attract strong public support, because they have a significant social, economic and environmental impact. By teaming up with Total to give them great visibility through a dedicated platform, we will help to draw microfinance institutions to this sector. This new focus is also aligned with our determination to take part in the growth of green microfinance.”
“Our experience on the ground in more than 30 countries has shown us that you need more than just good technical solutions to reach as wide a clientele in the low income communities as possible,” commented Jérôme Schmitt, Senior Vice President, Sustainable Development & Environment at Total. “You also need to provide access to financing, even tiny amounts, on a broad scale. We’re working on that in countries where our Awango by Total lineup is available. This innovative platform, created in partnership with a leader like Babyloan, will help us do that.”
Babyloan and Total will début the access to energy crowdfunding platform in early 2016. The platform hopes to be financing 2,000 microbusinesses in a dozen countries within two years.