This, the pair thought, would boost sales, as mobile banking platforms provided an easy way to add credit and get paid back – and would allow them to turn devices on and off remotely if customers failed to pay. “We were dealing with the poorest families in the world,” says Malango, 41, who along with Mashangao serves as Altech’s CEO.
Altech has become a leader in what is called pay-as-you-go solar, which operates in 23 of the 26 provinces of the Congo, with 3,500 agents who make more than 10,000 sales per month. In 2019 it added a larger system with multiple outlets and outlets for TVs, computers and even refrigerators, and recently started experimenting with electric scooters. The amount grew sixfold in two years, reaching $20 million in 2022.
Congo is one of the most difficult places in the world to do business. Transparency International, an international anti-corruption watchdog, says their corrupt culture allows politically-aligned criminals to take over the country’s natural resources, leaving the government in dire straits and impoverishment.
But Malango says his connections and background have helped him navigate their culture in ways that would challenge outsiders. Altech received $18 million from investors including a fund backed by the Shell Foundation and Dutch development bank FMO, and is in talks with three potential investors to raise another $75 million. “Altech is in a good position because of the local talent,” says Edmund Higgenbottam, managing director of Verdant Capital, one of the firms negotiating to back Altech.
Pay-as-you-go plans accounted for nearly half of all solar power sales in sub-Saharan Africa, according to the Global Off-Grid Lighting Association, which researches and promotes the industry. But businesses are struggling with low margins and suffer from high interest rates while serving the world’s poorest and least educated consumers. And some sellers give misleading information about the prices of products, for 2022 Bloomberg Green investigation found.
Eric de Moudt, CEO of London-based fund African Frontier Capital, says the pay-as-you-go model makes sense in Congo, where many people rely on dirty, dangerous kerosene lamps that require repeated purchases of fuel. Solar lights, by contrast, are clean and free to charge, and mobile money networks mean consumers don’t have to leave home to pay their bills. With kerosene lamps, there is “black smoke filling the house, children piling up, smoke in their eyes and constant fires—bad things,” says De Moudt. The sun is “a hundred times better.”
Africa offers unlimited demand for small solar installations. Nigeria has about 90 million people without electricity, Congo has 70 million and Ethiopia 56 million, according to the Off-Grid group. The global market is on track to grow tenfold by 2030, to 1 billion households, the group says.
The technology offers the hope of doing to the electric grid what cell phones did to landlines: leapfrogging the system with a distributed network that provides people with low-cost services that they can build on over time. “There are millions of customers, even in rural markets, whose access to the grid cannot be sold,” said Jonathan Shaw, co-founder of Nuru, a company developing solar minigrids in eastern Congo.
For Malango, who grew up without a grid connection, nothing compares to bringing solar power to the most remote areas of Congo. He said: “I know first hand the problems caused by the lack of electricity.” “For the first time people see a light bulb, a TV – that’s when you feel we’re doing something big.”