FosRich partners with Access on energy financing
FosRich Company Limited has added energy financing to its business mix for customers purchasing renewable energy products, in partnership with microfinancing outfit Access Financial Services Limited.
FosRich Managing Director Cecil Foster says the company expects demand for financing to reach $200 million or more in the first half of this year.
FosRich deals in lighting, electrical, and solar-energy products. The financing programme covers solar water heaters and LED bulbs, tubes and outdoor lights. Customers will have up to five years to repay the loan, which will be disbursed by Access Financial at interest rates of 12 per cent and upwards, depending on the product.
Asked about the possible size of the solar-powered water heater market, Foster said his company alone has more than $1 billion of business on its books "much less the rest of the market, which has several players".
LOOKING TO UPSIZE
He is now seeking to upsize this business by adding the financing option, which includes an offer of up to $20 million for a solar system to power homes or factories.
"It's the first time we are offering financing in our history. It's a hire purchase plan, the first," Foster said.
The partnership between FosRich and Access will see either party making referrals to each other for business.
Once FosRich determines a customer's energy needs and cost of their system, they will be directed to Access Financial to apply for financing. And where a client of the microfinancing company is seeking energy loans, "they will start the process and then send you to FosRich to get an assessment and pricing done before completing the process", Foster told the Financial Gleaner.
He added that while most of the credit to be disbursed by Access will be sourced through the energy financing programme of the Development Bank of Jamaica, FosRich itself would back "a substantial portion".
"I can't say how much, but we will finance a portion," he added.
FosRich listed on the junior market of the stock exchange at the end of December following an initial public offering that raised $200 million of equity capital for the company.
FosRich has a customer base of more than 2,300 credit customers and 180,000, as disclosed in its prospectus.