The deadline has been extended to July 20, 2021
The Indo-Pacific Design Funding Window provides grant funding for the design and launch of catalytic blended finance solutions in certain countries in the Indo-Pacific region, focused on any of the following:
1) Climate Finance - Addressing climate change mitigation, climate change adaptation or both. Blended finance solutions with co-benefits of climate action are encouraged.
Must align with at least one of the following: SDG 7 (Clean Energy), SDG 11 (Sustainable Cities), SDG 12 (Responsible Consumption), SDG 13 (Climate Action), SDG 14 (Life Below Water), SDG 15 (Life on Land).
2) Gender Equality - Aim to make a significant contribution to gender equality outcomes.
Must align with SDG 5 (Gender Equality).
3) Blended finance solutions that also lead to climate action co-benefits like job creation are encouraged.
This Window is funded by the Australian Government.
For the upcoming deadline, we will give preference to -
Proof of concept stage applications that can attract private sector capital at scale and launch within 12 months of receiving the design funding grant.
For applications focused on climate finance, those focused on sustainable and resilient infrastructure, climate-smart agriculture and climate insurance.
Each application will be evaluated in context of the geographic and sectoral focus of the proposed financial structure.
Types of Applications
Practitioners can apply for feasibility study or proof of concept funding:
Proof of concept: If a feasibility study (or equivalent) has been completed, funding to complete all design and structuring activities to launch the vehicle. For example, finalizing the capital structure and financial model, establishing the legal structure, and producing key documents. Convergence will award repayable grants up to $350,000 for proof of concept work. Determination of whether a grant is repayable will be made on a case-by-case basis.
Feasibility study: Funding to explore the feasibility of the vehicle. For example, assessing the investability/bankability of the transaction, conducting market scoping and developing the vehicle structure. Convergence will award grants up to $200,000 for feasibility studies. Promising feasibility studies funded through the Design Funding Window will be considered for follow-on proof of concept funding.
To be eligible for consideration for the Indo-Pacific Design Funding Window, proposals must meet the following criteria:
- Focus - The proposal must be for a blended finance vehicle. The vehicle must aim to use catalytic capital from public or philanthropic sources to attract private sector investment to the identified development challenge. The vehicle must have a primary focus on at least one of the following: 1) climate finance 2) gender equality
- Geographic Eligibility - The target region for the blended finance vehicle must be one or more of the following "Eligible Countries" in the Indo-Pacific region: Afghanistan, Bangladesh, Cambodia, Indonesia, Laos, Mongolia, Myanmar, Nepal, Pacific Nations (Cook Islands, Federated States of Micronesia, Fiji, Kiribati, Nauru, Niue, Papua New Guinea, Republic of Palau, Republic of the Marshall Islands, Samoa, Solomon Islands, Tokelau, Tonga, Tuvalu and Vanuatu), Pakistan, Philippines, Timor-Leste, Vietnam and Sri Lanka. The proposal will be eligible for funding only if at least 80% of the target region consists of one or more of the Eligible Countries.
- Use of Funds - Practitioners can only use the awarded grant funding for the design and launch of the blended finance vehicle – not for investment capital or to fund operational activities of an already established vehicle. See grant portfolio for examples of previous grants made by Convergence.
- Proposal Format - The proposal must adhere to the applicable proposal template, detailing the development challenge, proposed blended finance vehicle, key risks and mitigation strategies, design activities and costs, and the applicant's relevant experience.
- Feasibility study proposals must 1) include an initial vehicle structure and investment thesis, and 2) have initiated engagement with potential funders and relevant stakeholders.
- Proof of concept proposals must 1) detail interest and ideally commitment to participate, from funders and relevant stakeholders, and 2) include an initial financial model.
- Type of Grant - Convergence aims to select the strongest proposals based on the eligibility and evaluation criteria. Convergence does not prioritize repayable grants and selection of proposals will not be based on whether a grant is repayable or not. If a grant is structured as repayable, the terms of repayment will be determined on a case-by-case basis with the grantee. Repayment is often contingent upon the launch of the proposed blended finance solution.
- Application Requirements - Proposals are only accepted from organizations or consortiums of organizations. The lead organization must be able to provide 1) proof of incorporation, and 2) financial statements for the previous fiscal year.
- Reporting - Practitioners awarded funding are expected to regularly report key challenges, learnings, and results. This will be synthesized into a case study or learning brief and published to support market-wide learning.
Proposals will be evaluated on the following criteria:
- Scalability and/or replicability: How much private capital does the vehicle aim to catalyze? If the vehicle is successful, can other practitioners use a similar approach?
- Demonstration effect: Is the vehicle testing a never-before-tested design? Is the vehicle replicating an existing approach in a new market? Has the need for using a blended finance vehicle been demonstrated? Is the vehicle attracting partners such as institutional investors that have not participated in the blended finance space before?
- Development Impact: What is the intended social, economic, or environmental impact of the vehicle? Who will be the ultimate beneficiaries of the vehicle and how will they benefit?
- Gender considerations: How will gender considerations be incorporated into the vehicle’s design and operations? What will be the gender impact of the vehicle?
- Additionality: Does the vehicle aim to deploy financial instruments that are under-supplied and will therefore catalyze financing with a high degree of additionality? Does the vehicle have strong potential to address a market failure in the short term, and catalyze broader market financing in the long term?
- Stakeholder support: Does the vehicle have the support of key stakeholders in the target region / country (e.g., government)?
- Likelihood to achieve financial close: Is the structure of the vehicle bankable/investable? Is the vehicle likely to attract investors and close within the short or medium term? Have investors been actively involved in the design of the vehicle?
- Response to Covid-19: How does the vehicle respond to Covid-19? How does the vehicle address economic reconstruction & resiliency in the medium term?
Our application process has three distinct stages:
- Stage 1: Application questionnaire, proposal submission, and initial shortlisting
- Stage 2: Detailed due diligence to shortlist proposals for Funding Committee review
- Stage 3: Compliance review and approval by Convergence’s Board of Directors
Further details are provided below.
Stage 1: Proposal Submission and Shortlisting
- Applicants are required to submit a proposal to the Indo-Pacific Design Funding Window using either the feasibility study or proof of concept template. Convergence reviews proposals according to eligibility and evaluation criteria and shortlists the most promising proposals.
Stage 2: Due Diligence & Funding Committee
- If shortlisted, applicants will be asked to respond to due diligence questions from Convergence, and if required, provide additional information. Based on the proposals and supplementary information provided, Convergence selects the strongest proposals to present to Convergence’s Funding Committee. The Funding Committee, composed of independent experts, assesses shortlisted proposals and recommends proposals for funding.
Stage 3: Compliance & Board Approval
- Following a recommendation from the Funding Committee, selected applicants will undergo a compliance review. Following this review, proposals are presented to Convergence’s Board of Directors for final approval.
Application Submission Instructions
Please read through the following steps carefully before submitting an application:
Step 1: Before drafting an application, fill out the design funding questionnaire on our website.
Step 2: Following submission of a questionnaire, email [email protected] to schedule a brief call with the Convergence team to ensure alignment of objectives and mission. If available, please attach a concept note or presentation to the email.
Step 3: After speaking to the Convergence team, applicants are encouraged to send a draft proposal to [email protected] at least 2 weeks before the application submission deadline. Feedback will be provided within 7 business days. Draft proposals must use the standard feasibility study or proof of concept template provided, unique to each Design Funding Window.
Step 4: Submit the final proposal by following the link provided to you via email.
Please note that Convergence will only consider one application per organization per round. Convergence is unable to provide detailed feedback on applications that are not shortlisted for funding.
Application Submission Deadlines
Applications to the Indo-Pacific Design Funding Window will be considered on a rolling basis. The upcoming application deadlines are given below.
- July 20, 2021
- October 15, 2021
Please visit this page to confirm subsequent deadlines.