Difference between revisions of "End-user finance in payment Systems in displacement settings"
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â | + | = Background = | |
 | + | Some of the biggest obstacles to a market-based energy supply and demand in communities in Ethiopia, Kenya and Uganda - whether real or just perceived - are the low and seasonal purchasing power of the customers, market risk due to the perception and narrative of the temporary nature of the camps, regulatory incertitude, and cultural barriers. All these factors concur with very low penetration of energy and financial service providers (respectively energy- and financial-service-providers) in displacement settings targeted by ESDS. | |
 | + |  | |
 | + |  | |
 | + | = End-User-Financing = | |
 | + | === Definition === | |
 | + | End-user financing (also âdemand-side financingâ) as a type of financing addresses end-users of a specific service or product with the aim to facilitate the meeting between demand and supply by intervening mostly on the âaffordabilityâ issue. | |
 | + |  | |
 | + | It is a form of financing mostly dealing with inelastic demand, such as the one of more vulnerable populations in the refugee camps, and it is usually complementary and/or alternative to more traditional âsupply-side financingâ (SSF). | |
 | + | It should be noted that while SSF usually intervenes directly both at âpriceâ (e.g. subsidies on products) and âquantityâ levels (e.g. financing to increase imports), EUF financing usually focuses on the âpriceâ axis only (making products and services cheaper), consequently having indirect benefits in terms of quantities that are made available on the market. |
Revision as of 09:39, 16 February 2022
Background
Some of the biggest obstacles to a market-based energy supply and demand in communities in Ethiopia, Kenya and Uganda - whether real or just perceived - are the low and seasonal purchasing power of the customers, market risk due to the perception and narrative of the temporary nature of the camps, regulatory incertitude, and cultural barriers. All these factors concur with very low penetration of energy and financial service providers (respectively energy- and financial-service-providers) in displacement settings targeted by ESDS.
End-User-Financing
Definition
End-user financing (also âdemand-side financingâ) as a type of financing addresses end-users of a specific service or product with the aim to facilitate the meeting between demand and supply by intervening mostly on the âaffordabilityâ issue.
It is a form of financing mostly dealing with inelastic demand, such as the one of more vulnerable populations in the refugee camps, and it is usually complementary and/or alternative to more traditional âsupply-side financingâ (SSF). It should be noted that while SSF usually intervenes directly both at âpriceâ (e.g. subsidies on products) and âquantityâ levels (e.g. financing to increase imports), EUF financing usually focuses on the âpriceâ axis only (making products and services cheaper), consequently having indirect benefits in terms of quantities that are made available on the market.