Lighting up your home on credit

Wednesday June 24 2009

By NATION Correspondent

Having electricity in the home has become more of a necessity today than ever before. Without power, certain things are not possible; like lighting the home adequately at night, using electronic items like TVs, fridges, computers and so on, unless one uses the much expensive solar, or paraffin lamps.

Yet, in spite of these needs, less than 10 per cent of Kenyans have access to electricity, especially in the rural areas. According to Kevin Sang, of Kenya Power and Lighting Company, KPLC currently serves about 1.3 million Kenyans.

Although the Government’s rural electrification programme was the noblest of ideas in efforts to ensure Kenyans have access to electricity supply, the same has not been fully achieved due to the low economic ability of the targeted Kenyans who live in such areas.

Domestic customers

“Rural electrification projects target public institutions like schools, colleges and health facilities. They also supply power to administrative posts, government offices and trading centres but not to domestic customers,” he said. This means that Kenyans who want electricity in their homes have to part with some money to get power into their homes.

However, few are able to afford this and so most have remained in the dark and miss out on the opportunities that present. That is why the Stima loan by Equity Bank is such a welcome move. Now many more Kenyans will be able to light up their homes.

The loan, which hit the market sometime last year, targets customers who have yet to apply for electricity and those who have received quotations but are unable to pay the requisite fees in full, says Mr Sang. The product is also only functional for those who live within a 600-metre radius from the nearest electricity transformer.

“Previous customer satisfaction surveys pointed out the need for the company to devise ways of enabling customers access some kind of credit facility through a revolving fund,” he adds. Currently, KPLC is in partnership with Equity Bank while the Kenya Women Finance Trust (KWFT) is in negotiation with the power company.

Equity rolled out the product just five months ago, while KWFT launched their product earlier last year, and has so far furnished women with loans totalling to Sh8 Million. For the women micro-financier, the loan is a welcome sigh of relief to hundreds of women who are the home-keepers.

“We think of social development through empowering women economically. We want to make sure that rural women can access electric power, which means creation of businesses and jobs in the area,” says Anthony Chege, director of operations at the bank.


To get the power in your home or business premise there are simple steps to follow. If you are applying through Equity Bank, you need to have your house fully wired and show a wiring certificate to prove that it the wiring has been done by a professional.

You will then need to apply for electricity supply from KPLC and get a quotation from them, following which you then take both your quotation and the wiring certificate to the bank, which will give you a letter of undertaking. The bank will then send an electronic listing of Stima-loan customers quoting to KPLC.

You will then present the letter of undertaking, contracting documents and a route map that shows in a sketch where you live to KPLC. Domestic users and rural enterprises who apply for the loan from Equity can access between Sh35,000 and Sh00,000 for service line installation.

KWFT offers women a loan average of Sh35,000 to 50,000, depending on the needs of the individual. “When a customer qualifies, they are allowed to pay within a year, through installments that are spread out in the 12 months,” Mr Chege adds.

A customer will need to raise 20 per cent of the amount quoted by KPLC to qualify for a loan. The loan attracts 15 per cent interest and is flexible in its repayment plan, where a client has an option of spacing the repayment period to more than a year.