Cashpower: prepaid electricity in Rwanda

Maarja Motus, an Estonian designer and my recent intern spent 3 weeks in Rwanda recently conducting some research on my behalf. Here’s an extract from her report on Cashpower, the Rwandese term for prepaid electricity.

An electricity agent (Cashpower agent) next to Kigali market has 300 customers, only 10 of them buy for whole month (business clients). .Agent sales per day 50 000 – 90 000 RWFs, that is 62.5-112.5 €. Home tarif is 134 Rwf/Kwh

The amount a family spends varies at large scale. A household with TV, washing machine, iron etc may spend 80 000 RWF per a month, where as a family with no home electronics, ( a lamp and a phone to charge), spends 3000 RWFs per month.

What enables it?

Services with the same pre-paid model, airtime sellers provide the existing sales network as well as the consuming habit of buying often and according to the need.

Power shortages that happen in the evenings around 1800-1900 hours, a couple of times in a week and keep people used to and relaxed about blackouts, and the blackout caused by lack of Cashpower are not taken emotionally (as a muzungu like me did).

House girls. A single young man earning 200 000 RFWs ( 250 EUR) as a driver can have a housekeeper who cooks, cleans, shops, and is always there to run to buy electricity. In the families with fixed income, there is likely to be a house girl who is sent the corner shop to top-up the cashpower whenever it has ended. (fist s/he is sent to check the meter, then to the to top-up cashpower).

Mobile money. Both MTN and TIGO carriers enable to buy electricity through their mobile money service, thus one can top-up their meter without leaving the house.

Interesting Side effect

Better awareness of the consumption. Being an temporary member at local house, she knew in numbers (its more common to express the consumption in days and money, not in kWh) how much more is spent on heating up the water tank. Sometimes it takes 5 days to end the cashpower, sometimes it lasts for 8 days. This difference makes people wonder where all the rest got wasted, did they forgot the hot water tank on for the day, did they left the lights or iron on, have they watched more TV this week? It makes people more conscious about consumption.

(this is interesting as in Europe with the climbing prices there are many startups developing home monitoring systems to cut expenses ( actually to data mine). People in Europe are less aware of how much they use and on what they use than in Rwanda.)

Photos coming soon!

About these ads
This entry was posted in Africa, Airtime, Alternative currency, Assumption filter, Business Models, Buyer Behaviour, Economy, Expenses, Informal & Flexible, Mobile platform, Strategy, Urban, User research, Value and tagged , , , , . Bookmark the permalink.