Ifeanyi Ukwuoma founded Powerfull Technology, a digital platform that facilitates loan repayments for deployed energy assets, to aid businesses like his mother’s cold room storage to overcome the challenges of unreliable power supply and complex loan acquisition processes.
Ifeanyi shared that his mother’s business was greatly affected by the unreliable power supply in Nigeria. As a result, she explored alternative energy sources and sought a loan to purchase a solar asset. However, she encountered a challenge as the interest rate was too high, and the repayment period was too short due to her lack of credit history. For him, this was an opportunity he needed to leverage.
“In recognizing the opportunity, I understood what was happening and investigated the problem. The problem is, 92% of businesses in Africa have no access to get any form of credit financing to own solar assets. The reason for that is because of the 26% default rates across the entire continent. 26% of credit lenders are unable to guarantee that after the loan has been dispersed into the real economy through solar asset finance, the money will come back to them,” he says.
This was how Powerfull was built.
The platform deploys a digital infrastructure that helps businesses and credit institutions meet at a point where both parties benefit. This is done by deploying a smart meter, a web application and a wallet system on the app. The system works to help credit lenders collect loan repayments that are scheduled, automated and on time from customers.
In this episode of Founders Spotlight, Ifeanyi Ukwuoma, the founder and CEO of Powerfull Technology, shared his plans to assist MSMEs in Nigeria by addressing the issue of poor power supply and providing financial services to local businesses.
How the Powerful system and model works
So after a credit or loan has been dispersed to the customer, Ifeanyi says the company installs the smart meters on the solar asset. And then, they connect the entire solar system to the inverter, which is then connected to the smart meter embedding it somewhere within the box.
“We connect this smart meter to the wallet system of the mobile application and this wallet system on the mobile application collects payments directly from the customer. And then we take this money and remit it to the dashboard where it’s then being taken to the credit lender.”
Ifeanyi Ukwuoma, CEO and co-founder of Powerfull Technology
He added that this whole flow could be a weekly or monthly scheduled loan amortization process. In terms of how the company makes its profit margin, he says it takes a cost collection rate.
“The business model is that we take a cut, a collection rate on every transaction that passes through the wallet system. So for any payment that goes through the system, we take a 7.5% collection charge on it. And we estimate that by December 2025 the gross transactional volume or gross merchandising volume will be around a million pounds and we should be able to get a 7.5.”
So, in a nutshell, the credit lenders give the money to the solar panel installers to install the solar panels for these businesses, and the end customer (businesses) pays the credit lenders. If they default, they are disconnected.
The innovation
The African and Nigerian fintech industry has numerous credit platforms and a well-established solar energy sector. It’s natural to question whether there’s a need for another player in the market. However, Ifeanyi clarifies that what sets this app apart is its automated ability to disable or activate the system in case of customer default, a unique and distinguishing feature.
“What we do is that the wallet system, the payment default triggers the wallet system to send a message to the smart metering to switch off the electricity supply coming from the solar system into that business.”
According to him, a customer’s unwillingness to pay is matched by their being disabled from enjoying the services automatically. This he says, solves the problem of customer’s willingness to pay for the loans, thereby helping these companies collect back their money.
Adoption so far
Ifeanyi Ukuoma says that the product’s market penetration and acceptance rate have been enormous as a third-party actor between customers and these credit institutions. He even claims that the statistics since launch have been startling.
“We’ve been growing at around 35% month-on-month since we launched this product in January 2023. At the moment, we have one signed commercial agreement with Neotropical Technology, two signed pilot agreements with Blue Camel and Portfolio. We have 14 letters of intent across three of them. Portfolio is a fund manager that deploys into solar asset financing.”
Ifeanyi Ukwuoma
Disrupting the Nigerian market
With the energy credit assessment or credit lending, solar asset financing and the energy market within Nigeria valued at around 105 billion, Ifeanyi says he believes that Powerfull technology can disrupt the market. He attributes this to the team’s experience and dedication, comprising his co-founders and other staff.
“Mayowa Abiodun, who is the co-founder and CTO of Powerfull Technology, used to work in a meta asset provider in Nigeria. It is also called this meta asset provider. What they do is make meters and they integrate proprietor software into physical hardware, which is the meters and they sell it to all these distribution companies like Eco Electric, Electric and investor. He is leading the technology team at Powerfull.”
“Ahmed used to work in a trust fund pension, primarily targeting solar asset financing. He will be helping the credit lenders to come up with a more robust, integrated, of course, digital system of assessing customers and collecting payments and basically ramping up those things. For me, I have deep connections within the industry. I am passionate about the energy transition and I have proven to be able to scale digital products. I also worked with Amazon,” he adds.
Read also: David Adeleke’s Zeeh Africa is redefining how Africans access credit facilities
Partnerships and expansion plans
Ifeanyi Ukwuoma says the company currently has two partners, one with Providus Bank, which provides a virtual account for them, and the other with Stemaco, a British company that makes meters, provided them with the API to integrate into their wallet system.
“Whenever a customer pays money into a Providus bank account that we create for them, they are seeing it on the wallet system. And then whenever we create a scheduled collection of payments from that wallet system, let’s say we’ve agreed that the amount will be very, N100,000, every week we’ll be collecting from this hotel, we take the N100,000 of the wallet system.”
So, they pay into their account, they see it in their wallet, and then we credit the credit institutions. What we want to be, is the IU to solution for solar panel installers, what I mean is that with our integration, they’ll be able to collect payment terms.
Ifeanyi Ukwuoma
For Ifeanyi, although the company would expand to other countries in the coming months, the major focus for now is Nigeria.
“We would get to all across Africa. But I want to start with Nigeria first, mainly Lagos, Abuja and Port Harcourt, before we then start expanding. I’m coming to Nigeria to spend a month meeting real estate companies and the facility managers or anyone who builds or manages any form of multi-housing or multi-office spaces,” he says.
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