Green financing allows women in Nepal to shape their own futures

As a single parent in her late 30s, Ganga Didi long worried about being able to provide for her child. Barely able to survive on her wages from cleaning office buildings in Kathmandu, she started looking for better opportunities. 

One option was to learn to drive a safa tempo, a small three-wheel electric bus that is a common feature of Nepal’s congested capital. In the 1990s, Kathmandu introduced around 700 of these buses as a pollution-busting measure, a move that also helped reduce greenhouse gas emissions. 

To pay for driving lessons, Didi took out a small loan with help from Aloi. The start-up channels low-interest financing to entrepreneurs engaged in green ventures. Two years on, Didi is a full-time bus driver earning double what she used to make and is even saving money to buy an electric three-wheeler of her own. 

“To see that transformation is really fulfilling,” says Sonika Manandhar, Aloi’s Co-founder and Chief Technology Officer. In 2019, she was named a Young Champion of the Earth, the United Nations’ most prestigious award for environmental action by young people. 

Since then, Manandhar and her team at Aloi have helped 2,300 microentrepreneurs in Nepal. Thanks to their efforts, women like Ganga Didi have been able to get small loans to pay for safa tempo driving lessons, buy expensive replacement batteries for their buses and invest in climate-smart farming, while tackling air pollution and climate change at the same time. 

So far, Aloi has helped to disburse US$800,000. Most recipients have been women, the majority of whom were not eligible for a bank loan.  

A woman driver sits behind the wheel of an electric bus in Kathmandu, Nepal. The woman received a loan through Aloi, a startup which connects grassroots entrepreneurs to low-interest financing.
A woman driver sits behind the wheel of an electric bus in Kathmandu, Nepal. The woman received a loan through Aloi, a startup which connects grassroots entrepreneurs to low-interest financing. Photo: Aloi

The United Nations Environment Programme (UNEP) will be inviting young changemakers aged 18-30 with outstanding ideas on how to protect and restore the environment to apply for a new round of Young Champions of the Earth awards.  

The application period opens on 27 February and closes on 5 April. Seven winners selected from every region of the world will receive seed funding, intensive training and tailored mentoring to bring their ambitious environmental ideas to life. 

“The recognition from UNEP really helped us to prove that we are serious and build the kind of network with banks and other partners that we have today,” Manandhar, 34, says.  

She cited the example of a leading bank in Nepal, which contacted her to offer its services. It is now poised to work with Aloi to provide individual loans of between US$2,500 and US$10,000 to help women farmers to adapt to climate change. 

Last mile banking for green businesses 

More than three-quarters of women in Nepal work in the informal sector and cannot show lenders any credit history or proof of income. In addition, many women entrepreneurs are unable to take out a loan because they do not own any land to put down as collateral. 

Manandhar used her background in computer engineering to address the problem. She and her team came up with a system where loans are provided in the form of digital tokens that can be accessed by SMS and used to pay for goods and services from verified vendors.  

The technology also allows lending institutions to track where and how their funds are being spent. The data trails help borrowers like Didi to build a strong credit history that can be used to access financing to scale up their green businesses. 

“Our vision is to become a leader in last mile delivery of banking services for women entrepreneurs and green businesses,” Manandhar says.  

Private-sector-led businesses like Aloi have a vital role to play in funding solutions to the triple planetary crisis of climate change, biodiversity and nature loss, and pollution and waste. Aligning finance to environmentally sustainable objectives is expected to be a major topic of discussion at the sixth session of the United Nations Environment Assembly (UNEA-6). The world’s highest environmental decision-making body, the Assembly takes place in Nairobi, Kenya, from 26 February to 1 March.  

“Aloi’s work shows the enormous potential of matching inclusive digital financing with environmental goals,” says Rob de Jong, Head of UNEP’s Sustainable Mobility Unit. “Not only are microloans in Nepal helping to cut emissions from the road transport sector by promoting the use of electric vehicles, they are also empowering women entrepreneurs.”  

Electric buses are parked inside a garage in Kathmandu, Nepal.
Electric buses are parked inside a garage in Kathmandu, Nepal. Photo: Aloi

Fighting dirty air 

Kathmandu is surrounded by mountains, which trap air pollution from petrol- and diesel-run vehicles, creating a blanket of smog. In 2021, the city’s air quality was the worst in the region. In 2019, air pollution was the leading risk factor for deaths in Nepal, accounting for nearly 22 per cent of all fatalities. Electric vehicles, which have no tailpipe emissions, are considered key to lowering that toll. 

They are also viewed as important tools in the campaign against climate change. Globally the transport sector is responsible for about one-quarter of all greenhouse gas emissions with those set to double by 2050. But humanity can reduce that tally by up to 4.7 gigatonnes by embracing electric vehicles and by creating safe spaces where people can walk, cycle and use other forms of non-motorized transport. Cutting vehicle emissions would also reduce deaths from exposure to exhaust fumes in urban areas. 

This year, Aloi is aiming to help 100 more women learn how to ride an electric motorbike and buy their own electric scooter. This would allow them to work as couriers with jobs guaranteed by a logistics company. Aloi also plans to provide training for women interested in becoming mechanics on electric vehicles. 

As a young woman working in tech and finance, the journey has not been easy for Manandhar. But she has always seen the opportunity in challenges. “Problems excite me because that’s a chance for you to solve something. What’s the fun in having an easy life?” she says, laughing.  

Her advice for other young environmentalists is simple.  

“Try things, even if they fail, learn and come back. Use that learning to build something amazing. Because if you never try then the output is always zero, so I would advise everybody just to get your hands dirty.” 

Young Champions of the Earth is a forward-looking prize designed to breathe life into the ambitions of brilliant young environmentalists. The award is bestowed annually on seven ambitious young people from around the world with outstanding ideas to protect and restore the environment. 

The sixth session of the United Nations Environment Assembly (UNEA-6) will be held from 26 February to 1 March 2024 at the UNEP headquarters in Nairobi, Kenya, under the theme: Effective, inclusive and sustainable multilateral actions to tackle climate change, biodiversity loss and pollution. Through its resolutions and calls to action, the Assembly provides leadership and catalyzes intergovernmental action on the environment.


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