The role of microfinance in scaling up access to renewable energy technologies in Tanzania

This study assesses the role which can be played by microfinance in scaling up access to renewable energy in Tanzania. It aims at identifying challenges faced by Microfinance Institutions (MFIs) in providing renewable energy loans to entrepreneurs and barriers which are faced by entrepreneurs of renewable energy in accessing micro credit for their businesses. The research was conducted to Micro finance officials and entrepreneurs who have managed to acquire loans from MFI institutions. Data were gathered through questionnaires and written documents. Data analysis was done by SPSS software which enabled the researcher to generate various statistical measurement available. The study found that MFIs financial capacity, knowledge on renewable energy technologies and high perceived risks of renewable energy are main challenges which hinder MFIs from playing a pivotal role in scaling up aces to renewable. MFIs are not aware of the huge business opportunities presented by renewable energy technologies. The main conclusion drawn in this research is that without building their financial capacity, human resource and institutional capacity MFIs role in renewable energy and adaptation will be limited. Based on the findings, it is recommended that MFIs should commit to expanding their loan portfolio to include clean energy loans. This should go together with increase their knowledge on renewable energy technologies.