Money matters: Does access to financial services foster household energy transitions in Africa?

Financial inclusion is hypothesized to facilitate adoption of modern energy technologies, but the relationship has not been extensively studied in the African context. We use the World Bank Energy Sector Management Assistance Program (ESMAP) Multi-Tier Framework (MTF) Global Surveys on Energy Access for Kenya, Rwanda, and Zambia to examine the relationship between financial services and adoption of modern energy technologies. Using a series of logit regression models, we interact gender of the household head with financial inclusion variables to understand this relationship in rural–urban households, controlling for a range of household demographic and socioeconomic characteristics. We find that bank account ownership is broadly associated with grid connection, solar ownership, and clean cooking fuels, with the most robust associations observed among male-headed households in urban settings. Access to credit is linked to the adoption of solar technologies and clean cooking fuels, but not across all settings. Mobile money is associated with grid electricity access for all households in Kenya, and with solar adoption for female-headed households in Rwanda and Zambia. Our research demonstrates the differential role of financial services in catalyzing household energy transitions by gender of household head and rural–urban settings. Future studies should collect data on individuals and intrahousehold dynamics to better inform policymakers about the potential gender-related mechanisms that support financial services as a pathway to household energy transitions.