PaygOps, the main product of Solaris Offgrid, a UK registered company, recently launched a service through which providers of pay-per-view solar products (PAYGO) can raise funds by selling receivables. PaygOps software allows investors to study and purchase contracts from PAYGO providers. This reduces the extent of due diligence that lenders must perform on vendors compared to the more common practice of using contracts as collateral for a loan. PaygOps plans to reduce investment costs enough to reduce the minimum profitable PAYGO investment size from around $ 500,000 to less than $ 500,000. 100,000 USD.
Solaris CEO Siten Mandalia said: “With this new facility, we aim to separate the credit supply by allowing investors to participate directly in debt pools. By streamlining funding in this way, we can help hundreds of distributors reach the… unbanked population who need essential products.
PAYGO solar product suppliers offer equipment such as solar home electric systems and water pumps that can be turned on and off remotely when users choose to purchase utility units. Kenya-based Pawame supplies PAYGO solar products to 16,000 households that are not connected to electricity grids. She is in the process of selling part of these contracts to investors through PaygOps for an undisclosed price. The seed investor in these sales is First Growth Ventures, an impact investor based in France.
Maxime Bouan, Partner of First Growth Ventures, said: “Managing due diligence and complex debt structuring can be quite difficult for investors in the PAYGO market due to the inconsistency of data formats that we are presented. Having access to standardized data and being able to comprehensively assess the receivables portfolios of start-up distributors via the PaygOps mechanism is a game-changer for investors in terms of costs and time savings.
Founded in 2014, Solaris provides software and other services that support businesses in developing countries serving low-income people.
Additional sources and resources
PaygOps press release
Solaris Home Page
Pawame Home Page
VC4A Profile on First Growth Ventures
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