The outlook for PAYG in clean cooking

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What little research has been conducted so far shows that PAYG technologies can unlock clean cooking for populations that are otherwise unable to afford it. Yet these business models are challenging and capital-intensive, as has been demonstrated by a number of high-profile liquidations or product withdrawals (e.g., Inyenyeri). However, there are some success stories emerging from companies that have now reached noteworthy levels of scale in urban areas (e.g., Circle Gas and KOKO Networks), often with heavy support from carbon credits.

But despite this progress, it is also important to acknowledge that PAYG is no silver bullet. Although these models are theoretically highly scalable, their overall market penetration remains negligible. PAYG-enabled clean cooking products are likely to remain unaffordable for the very bottom of the pyramid, and PAYG companies have yet to conquer any rural markets. Further support from governments and donors may be required for these businesses to achieve exponential scale, whether in the form of australia whatsapp number data subsidies, tax exemptions or other incentives.

To summarise, PAYG cooking products can increase the affordability and accessibility of clean fuels, while placing customer satisfaction at the heart of these companies’ operations. PAYG therefore addresses many of the challenges that have historically limited the clean cooking sector. However, these business models bring additional complexities that may hinder their growth. More research is needed to understand the true impacts of PAYG business models, how they can reach profitability and scale, and how the rapidly developing landscape of support mechanisms for the clean cooking sector — such as results-based financing initiatives, carbon credits and targeted subsidies — can enable them to reach their full potential.