Sight Magazine – Wow! : Solar power opens door to banking for rural Indians

Aitawade Budruk, India
Thomson Reuters Foundation

Going to the bank in his native village in western India was a slow and frustrating process for Kiran Patil, as frequent power cuts – sometimes for days – turned what should have been a quick errand into a long one. test.

The 59-year-old farmer often had to queue for hours at RBL Bank, his local branch in Aitawade Budruk village, or abandon his transaction and return the next day, wasting time he should have been spending on farming its cultures.

That all changed after the building was fitted with an array of solar panels and backup storage batteries in 2018, breaking the bank’s reliance on the power grid and giving it a steady supply of clean electricity.

“Transactions are now so smooth and fast,” Patil told the Thomson Reuters Foundation. “These days we even find time for a quick chat with the branch manager over a cup of tea, to learn about the latest services and facilities.”

Solar panels on the terrace of the Rampachodavaram village branch of UBI Banks in India on June 30. PICTIRE: Courtesy of E-Hands Energy.

A more reliable banking experience also attracts new customers who didn’t have the time to wait long or who feared they would never know when they would be able to access their money.

Since the solar power system was installed at RBL in Aitawade Budruk, the bank has opened 25 to 30 new accounts every month – 10 times more than before, said branch manager Sandeep Banne.

“Transactions are now so smooth and fast. These days we even find time to have a quick chat with the branch manager over a cup of tea, to learn about the latest services and facilities.”

– Farmer Kiran Patil

As India increases its use of renewable energy in a bid to wean itself off climate-warming coal, the country is leaning heavily on solar power to reduce carbon emissions and help stabilize a grid compressed by climate change. coal shortages and growing demand from a population trying to keep cool during the hotter summers.

But some communities have discovered another benefit to the solar power push: better access to the financial system for millions of the country’s unbanked, including the estimated 20% of Indian adults who lack access to a bank account or a formal line of credit.

Raghuraman Chandrasekaran, founder and CEO of E-Hands Energy, the Chennai-based company that set up the solar unit in Aitawade Budruk, said his company had installed such systems in more than 920 rural banks across the country. India, helping to bring more than six million people into the formal banking system.

The company plans to install units in up to 100 more rural branches before the end of the year, he said.

“Citizens in rural areas would walk or spend their precious money to get transported from their villages to the nearest bank branch and then wait [there] for hours…simply because the bank had no electricity all day and the computers couldn’t work,” Chandrasekaran said.

“It was all misery.

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RBL Bank Aithawade branch manager Sandeep Banne works on his solar-powered laptop in western India on June 29. PHOTO: Courtesy of E-Hands Energy

The Aitawade Budruk branch’s three-kilowatt solar power system – which runs everything from fans and lights to computers and alarm systems – means the bank now has reliable power around 95% of the time, said Banne, the branch manager.

On cloudy days, backup storage batteries take over, he said.

Companies like E-Hands Energy, Tata Power Solar and Husk Power Systems have so far equipped more than 2,000 banks in rural India with solar power, estimates Shyam Kumar Garg, who retired as managing director Deputy of the National Bank for Agriculture and Rural Development. October.

The systems are fueling India’s effort to install 500 gigawatts of renewable energy capacity by 2030, up from about 115 GW currently, more than half of which is solar.

E-Hands Energy COO Kakumanu Prathap Sagar said the solar systems the company has installed in banks across India are helping to cut about 3,000 tonnes of carbon emissions every year.

Using solar power can also reduce costs, RBL’s Banne told Aitawade Budruk, noting that the branch now spends a fraction of what it used to spend on grid electricity and diesel for its generators. rescue.

The solar systems cost between 130,000 and 150,000 Indian rupees ($1,650 to $1,900) to install and maintain for four years, and pay for themselves in about four years, he added.

For the villagers, the biggest benefit is finally being able to use government services they never had access to before, said Pratibha Budruk, head of Aitawade Budruk village council.

When the bank suffered power cuts and frequent loss of internet connectivity, payments for pensions, scholarships, loans and insurance were often delayed, putting a strain on people who depended on the money , Budruk said.

“The transition from rural banks to solar power…has opened the doors to modern banking facilities for our local villagers,” she said.

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An inverter and battery system that make up UBI bank’s solar power system, in the village of Rampachodavaram, India on June 30. PHOTO: Courtesy of E-Hands Energy

In a country where 65% of the population lives in rural areas, according to the World Bank, switching rural banks to solar power could even slow the migration of young people from villages to cities as more and more more economic opportunities at home, energy management said. expert Binoy Krishna Choudhury.

“The solarization of banks is a good step to develop the rural economy,” said Choudhury, who teaches at the Indian Institute of Social Welfare and Enterprise Management in Kolkata.

But plans to bring solar panels to rural banks face a series of hurdles, said Russell deLucia, director and founder of the Small-Scale Sustainable Infrastructure Development Fund, a US-based nonprofit.

Potential hurdles include finding ways to transport and install equipment in remote, often off-road locations, said deLucia, whose company helps E-Hands raise funds for its solar power projects.

Once the systems are up and running, finding trained technicians nearby to fix anything that’s broken is another issue, he said.

Despite these challenges, Budruk, the head of the village council, wants to see more banks tap into solar power as a way to both improve the lives of rural communities and limit the worsening impacts of climate change such as extreme heat.

“Installing solar systems in riverbanks is like planting trees all year round to purify the air we breathe,” she said.

“As the world strives to slow global warming and the impacts of climate change, this is a small contribution from our village.”