The Armenia Project uses an asset-backed loan model that enables agro-businesses to install solar stations and reduce the cost of food production.
Micro-enterprises in Armenia’s agribusiness sector often do not use modern mechanized processes, which result in low levels of productivity. Productivity is further constrained by production costs, which are comparatively high, and a major cost is electricity. Installing a solar station would reduce overall production costs by 30 percent, but they cannot afford this US$ 10,000 investment.
Project Armenia aims at setting up a financial model with the private sector to provide affordable access to credit for small and medium enterprises (SMEs) to install solar stations and reduce their energy dependency and operational costs. Such solar systems are expected to reduce electricity costs resulting in 30 percent savings for businesses.
The Armenia project team wants to improve their online customer application process, and test it on 20 new customers The main hypotheses to be tested and validated are: (1) the viable monetary investment of the micro-enterprise, and how the blended finance model can be modified to increase project sustainability and (2) the interest in the project by micro-enterprises, and the ways that it can increase the scope to other product types.
