Status update — June 15, 2016

Kiva and Paradigm Project have agreed to end their partnership after over 3 years and more than $35,000 in loans raised. This Lending Partner has repaid its outstanding balance to Kiva in full, and these funds have been distributed to lenders. We thank Paradigm Project for the years of collaboration and wish them success in their future endeavors.
 

Partner description:

The Paradigm Project (TPP) is a for-profit company that builds supply chains to deliver energy-efficient products to low-income families in developing countries. Headquartered in the U.S. with direct operations in Kenya and Ethiopia, the organization works through its overseas subsidiaries and select distribution partners to supply clean-burning cookstoves directly to consumers.

Over 2.5 billion people in the developing world burn charcoal or use open fires to cook their food, leading to nearly 4 million deaths each year from exposure to indoor air pollution. In addition to the adverse health effects, open fires are incredibly inefficient, leading to high consumption of wood and charcoal and contributing to deforestation in countries already burdened by a changing climate and limited natural resources. Finally, buying wood or charcoal places a heavy financial burden on families who spend up to 35% of their household income on cooking fuel.

In Kenya, TPP works though it’s local subsidiary, EzyLife, to sell high-efficiency cookstoves to consumers in the country’s lowest income brackets. Additionally, the company is working to expand its supply chain to include solar lights, water filtration products and clean, sustainable fuels, creating additional benefits to consumers who need these technologies.

Traditionally, clean cookstove programs have used small-scale local manufacturing and local materials to offer products that are low quality with an average cost of US $5 to $10. In contrast, TPP offers consumers more durable mass-manufactured products that feature higher performance and consistency at a cost o $20 to $40 on average.

Kiva lenders’ funds are used by TPP to offer loans to consumers interested in purchasing high-quality, high-efficiency cookstoves. Additionally, these funds help the organization decrease its interest rates on loan products, enabling more customers to access credit for stoves.

A unique lending approach:

TPP is working on a wood and charcoal stove program throughout rural Kenya with a specific focus on low income (US$1.25 to $2.25 per day) women.  The cookstoves TPP distributes significantly reduce fuel consumption and toxic emissions when compared to cooking over an open fire.  For customers, this translates to lower household expenditures, time savings, and an overall improvement in quality of life.  

Our field research has shown that affordability – much more so than price – is the primary barrier to women obtaining our products.  This means that demand for the product is high at the current offered price, but our customers’ disposable income is limited. Women understand that a reduction in fuel consumption leads to a an increase in household savings.  When a stove is financed, these savings can be realized and directly applied to the purchase of an asset that will provide the family with a very real financial return for up to 3-5 years.

TPP has helped families collectively save an estimated $8 million by replacing wood and charcoal fires with energy-efficient stoves. The organization also creates local jobs in Kenya.

For its efforts, TPP was named the most promising social enterprise in America in 2012 by Bloomberg/BusinessWeek and has been one of B-Corp’s “Best for the World” for two years in a row.

Watch this short video about The Paradigm Project’s work and impact.

The Paradigm Project joined Kiva through our Experimental Partnership Program, and has therefore received a lighter level of due diligence. Accordingly, loans associated with this partner carry a higher level of risk than typical Kiva loans