On a recent morning in Maddinayakahalli, a small village in Karnataka, India, Usha Devi prepared soaked rice, lentils, and spices to make fresh batter. She lit her stove and started making crispy dosas, a form of savory crepes popular in southern states of India, for her family. When she and her husband finished eating, she stored the remaining batter in the refrigerator to make another batch for breakfast the next morning. He left for his work running a local milk collection center, and Usha began her duties managing their small dairy farm.
Before she started using a cooking stove for all her meals, Usha used to spend hours searching for firewood to cook on a chulha, or an earthen stove, or she was at the mercy of fluctuating prices of cooking gas. She recalled, “I would get constant coughs and headaches from the smoke. I used to spend hours gathering firewood. Sometimes, I would have to go looking for firewood even when it was too hot, and it was just exhausting.”
In March 2023, Usha installed her village’s first biodigester, which helped her carve a path out of her daily drudgery.
Cattle farming is a vital part of India’s agricultural sector — providing income and employment to millions of smallholder farmers. However, the resulting farm waste, especially organic waste from animals, poses significant environmental hazards, including water and air pollution, greenhouse gas emissions, and risk of infectious diseases, impacting both human and environmental health.
Biodigesters turn animal waste into biogas, a clean fuel, and slurry, a form of organic fertilizer. Biodigesters can be prefabricated, modular, and durable, making them easy to install even in rural areas where accessibility, installation, and maintenance can be challenging. As hundreds of kilos of animal waste from dairy farms gets turned into fuel, farming families save household money on gas, free up hours formerly spent gathering firewood, and supplement household income through the sale of by-products such as bio-slurry.
“Incorporating biodigesters into our dairy farm has not only improved our milk production but has also lightened my workload,” Usha shared. “The time I used to spend managing waste is now spent on other productive activities, and the extra income has helped us reinvest in our farm.”
With the money she previously spent on cooking gas, Usha made an important investment — a refrigerator. “Buying a fridge changed my routine,” she explains. “Now I can prepare meals in advance, which makes my mornings much less hectic when I’m juggling all my tasks.”
Despite their benefits, biodigesters are out of reach for many. The upfront cost requires a farmer to forgo more immediate needs. Moreover, smallholder farmers, particularly women, struggle to access financial services, especially to invest in green assets such as biodigesters, water tanks, or solar panels. Traditional financial institutions consider these farms too small, too remote, or too risky for loans or credit — leaving a substantial gap between farmers’ needs and access to productive assets.
To help fill this financing gap, Accion partnered with Sistema.bio, Pahal, and Stellaps, to explore green asset financing for farmers, with an emphasis on women, in India and Kenya. The program, launched in 2023, aimed to identify scalable financing models that combat climate change and help women dairy farmers access and own productive assets.
In India, partnerships emphasized technology-driven solutions and bundled financing models to integrate biodigesters into farmers’ daily operations, leveraging data for improved financial access. The project promoted adoption of biodigesters by introducing financing solutions tailored specifically to the needs of dairy farmers, recognizing the significant role these assets can play in reducing farm waste, enhancing agricultural productivity, and generating cleaner and cheaper sources of energy. Accion, along with our partners conducted extensive outreach and education in villages, introducing the equipment, explaining its utility, and highlighting the economic and climate benefits to dairy farmers like Usha Devi.
To make the technology even more affordable and support sustainable farming practices, Accion leveraged India’s carbon finance market to unlock a subsidy for the biodigester, which qualifies for carbon credits by reducing methane emissions by converting organic waste into a cleaner energy source. The use of biodigesters also reduces the need for cooking gas and firewood, further lowering carbon emissions. The market price of a biodigester is approximately INR 41,260 ($495), but after applying the carbon credit subsidy, the cost to the farmer was reduced to INR 6,000 ($73).
The embedded finance model helped 250 dairy farmers, including Usha Devi, invest in installing biodigesters in their farms through two financing mechanisms. The milk receipt-based model, developed with Stellapps, leveraged farmers’ milk sales data to enable credit assessments and structured repayments aligned with farmers’ cash flow from their dairy businesses. Meanwhile, the product bundling model, designed with Pahal, integrated biodigesters into cattle loans, allowing farmers to access financing for both productive assets simultaneously. These approaches ensured that smallholder farmers could adopt biodigesters without financial strain, making clean energy solutions more accessible to them.
Customers reported experiencing economic relief by saving on fuel costs, enabling them to invest in other household needs and income-generating activities. During the project impact survey, 95 percent of participants indicated that their income increased after using biogas, primarily due to savings on Liquefied Petroleum Gas (LPG). 93 percent of participants stated that biodigesters contributed to their savings goals which will be used for their children’s school fees, purchasing another cow, or covering household expenses. With the money Usha used to spend on cooking fuel, she saved up to purchase a refrigerator that helps reduce her food costs. With her additional free time, she took on more duties at her family’s small restaurant. Repayments for the biodigester are withdrawn directly from her mobile wallet, providing an easy and seamless experience.
The transition to biogas also led to a reduction in respiratory ailments and injuries associated with traditional cooking methods, enhancing the overall well-being of customers. 94 percent of participants ceased using firewood, and 82 percent discontinued the use of chemical fertilizers.
Women, who often bear the brunt of household chores, gained more autonomy and improved their quality of life through the adoption of biogas. Usha shared, “I feel more empowered now because I have control over my time and can support my family in more ways than before.”
Read more about how Accion is helping women farmers in India and Kenya grow sustainably with green asset financing.
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