A Small Investment can bring out Significant Impact in Rural Lives: A case study of Shree Himchuli Agriculture Cooperative Limited

Shree Himchuli Agriculture Cooperative Limited was established in Manma VDC of Kalikot district in August 2008. Kalikot is one of the remote districts of Nepal where many VDCs rely on traditional sources for lighting and cooking. In this backdrop, Shree Himchuli cooperative initiated promotion of solar home system (SHS) in 2010 with the technical support from Winrock International. Through its project “Credit Financing of Solar Home System for Deprived Communities in Rural Nepal” funded by the Frankfurt School of Finance and Management, Winrock International build the capacity of financial institutions, created linkage between Himchuli Cooperative and Ace Development Bank  and facilitated installation of 988 SHS in Kalikot district of Nepal. Previously, the cooperative had accessed government subsidy for SHS installation but now it is being promoted without subsidy. Building on this, the association is extended to UNCDF’s Cleanstart project being implemented by Ace Development Bank with the technical collaboration of Winrock International from 2014 onwards. Shree Himchuli Cooperative is one of the major partners in UNCDF-Cleanstart project.  Till date, the cooperative has disbursed loan for installing 4,724 SHS in the district. Likewise, the cooperative has provided RE loan to disseminate Matribhumi improved cookstove (ICS) in 570 households of Phukot VDC (57% of the total households in the VDC) of Kalikot district to support VDC in achieving the target of declaring it Indoor Air Pollution (IAP) free.
Shree Himchuli Agriculture Cooperative Limited has over 5 years of demonstrated experience in SHS and ICS financing. The cooperative has been incentivizing RE loan by subsidizing interest rate on such loan by2% less than other loan products. The most attractive aspect is that the cooperative is promoting RE through its female members. Cleanstart project has supported the cooperative with server, laptop and desktop so as to maintain interconnection between all its 4 branch offices. Winrock had already conducted orientation programs, training on developing business plan and constantly facilitating Himchuli for the wholesale lending from Ace Development Bank. As of today, Himchuli has total USD 25,838 as outstanding energy loan taken from Ace development bank.

Through Shree Himchuli’s financing scheme, majority of households are using 20Wp SHS which costs around USD 85, of which USD 15 is user equity and the remaining amount is loan. In case of ICS, the final price to the user is USD 20 including USD 5 as installation charge; each ICS was installed with 50% loan and remaining 50% of the cost was borne collectively by the user, VDC, and other similar programs. Loan
repayment scheme follows monthly installments for up to 1 to 2 years. The VDC office has set a provision where households not willing to install ICS are deprived of any other VDC facilities. According to the cooperative officials, their RE financing scheme has 100% repayment status on schedule so far.

The cooperative has facilitated installation of ICS solely at household level whereas SHS has been installed in households, 7 schools, 6 health posts, 3 computer institutions, 5 photocopy shops, bus counter, hotel and small shops. Himchuli has extended its credit support for more than 1,000 SMEs in Solar system installation. Shops, hotels and bus counter is using SHS only for lighting whereas schools have been utilizing the power to operate computers and the health posts are using it for refrigerator.  To summarize it up, Shree Himchuli Cooperative has been supporting the communities in earning additional income and also supporting Government of Nepal in achieving its target of providing clean cooking and lighting solutions to all by 2017. Besides, it’s effort has helped in end use promotion which remains as one of the major concerns in the sector of RE promotion.

Ms. Raju Pandey from Ward No. 8 of Manma VDC, Kalikot, shares that SHS has brightened her house and helped her in performing the household activities during the night. It has also helped her children to study at night. She further said SHS is cleaner than the traditional sources of lighting.
Ms. Gaura Neupane from Ward No. 5 of Manma VDC, Kalikot, is very happy to have ICS installed at her home. She shares that the indoor environment has improved owing to reduced smoke emissions from the ICS. Besides, she can now cook food with very few amount of firewood which has ultimately reduced drudgery and the utensils remain cleaner than before.