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To celebrate its 10th anniversary, Convergence will host the first ever Global Blended Finance Forum in Washington, DC at the Fairmont Georgetown Hotel from November 3-5, 2025.

This first of its kind gathering will bring together a wide spectrum of blended finance practitioners to share insights, discuss market trends, and break down silos, with an aim towards defining the next decade of blended finance.

The Forum will offer a variety of programming focused on the most urgent blended finance issues including private sector and local capital mobilization, data transparency, and standardization. Attendees will also have the opportunity to participate in multiple networking opportunities designed to foster collaboration and inspire and galvanize them to shape the future of blended finance.

Convergence members get access to preferred pricing. Early bird member tickets are $500 (compared to $750 for non-members). To get the discounted rate, reach out to your relationship manager.

*Early bird registration is currently open. Follow the [event LinkedIn page](https://www.linkedin.com/showcase/global-blended-finance-forum/) for up to date information, including newly announced speakers, agenda items, and themes.*

Global Blended Finance Forum

To celebrate its 10th anniversary, Convergence will host the first ever Global Blended Finance Forum in Washington, DC from November 3-5, 2025.

Convergence Global Blended Finance Forum

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__Tuesday, July 8, 2025, 9:30AM - 4:30PM CET, Paris, France__

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As an intermediate-level programme, the full-day training will combine blended finance and mobilization data, information and cases, insights from Convergence experts, notable speakers from major organizations, and technical experts in the field. Convergence members will participate in an inspiring, interactive, and practice-driven day of learning and knowledge sharing around blended finance as an approach to mobilize more private capital for the United Nations Sustainable Development Goals and Paris Agreement.

The agenda will feature:
- The State of Blended Finance 2025 – Market trends
- Blended Finance for Biodiversity – Deep dive
- Group exercise: Analyzing a Blended Finance Transaction
- Fundraising Deal Marketplace
 

This training is complimentary for members (one seat for Standard Membership, two seats for Market Builder Membership), USD 500 for additional member seats, and USD 750 for non-members. Please contact your relationship manager for more details or questions on your membership type.
 

*Register by June 18th to reserve your seat.*

In-Person Convergence Training for Blended Finance Practitioners in Europe (Paris, France)

Join us in Paris, France for a full-day training combining blended finance and mobilization data, information and cases, insights from Convergence experts, notable speakers from major organizations, and technical experts in the field.

Blended Finance Training in Paris, France

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Wednesday, July 2, 9am – 10am ET

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Are you new to the Convergence platform? Join us for this interactive session to learn how to navigate Convergence’s blended finance data, deal flow, and events calendar. A team member will walk you through the different functions on our website using real world case examples. Together we will search the historical deals database for a particular transaction type, navigate the investor database to find the top 10 impact investors for a particular sector, and much more.

This session will use an interactive format to answer members’ frequently asked questions. Join us to discover how to use Convergence’s blended finance data in your day-to-day work.

This session is open to all Convergence members.

Member Q&A Session: How to Navigate Convergence’s Member Platform (July 2025)

Join us to discover how to use Convergence’s blended finance data in your day-to-day work.

Navigating Convergence’s Member Platform

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__Thursday, June 19, 2025 at 2:30PM - 3:30PM CET__

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Join the World Association of PPP Units & Professionals (WAPPP) for a dynamic session exploring how subnational governments and entities (such as municipalities and SOEs) are leveraging blended finance to deliver community-focused infrastructure through PPPs. Building on WAPPP’s 2024 theme of small-scale PPPs and linking it to the 2025 focus on blended finance, this session will feature case studies, insights from local governments, and trends from Convergence—highlighting innovative financing models that address the unique challenges and opportunities at the subnational level.

WAPPP 2025: Local Governments-led Blended Financing in PPPs

Join WAPPP for session exploring how subnational governments and entities (such as municipalities and SOEs) are leveraging blended finance to deliver community-focused infrastructure through PPPs.

Local Governments-led Blended Financing in PPPs

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Wednesday, June 18, 9:00am – 10:00am SGT

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Convergence is working on the __Scale Private Investment Mobilization Project__ - with UN DESA, UN ECA, OECD DAC members, Gates Foundation and others – to identify the best solutions that will mobilize private investment at scale, fully aligned to the upcoming Financing for Development 4 (Ff4D) Outcome Document. The solutions will use MDB and DFI capital optimally and as little ODA/ODA-like money as possible to mobilize private debt and equity investment to significantly higher volumes to fund private sector and public sector projects in emerging markets. This can only be achieved with high alignment with the developing countries' priorities/ownership and debt sustainability.

We believe that we do not have a monopoly on the best solutions to mobilize private investment at scale, nor to simplify and standardize blended finance. In this regard, Convergence invites all those interested to participate in a 60-minute Consultation Session to: i) learn more about and get a status update on the Scale Private Investment Mobilization Project, ii) engage in open discussion and provide feedback on the list of Private Investment Mobilization Models proposed by Convergence; and iii) help inform the creation of an overall Action Plan for more effective, efficient, and fair deployment of catalytic and concessional capital in developing countries for scaled mobilization.

We encourage all participants to visit the [home page](https://www.convergence.finance/standardization) for the Scale Private Investment Mobilization Project and familiarize themselves with the core project documents prior to the session.

Information Session and Consultation on Convergence Scale Private Investment Mobilization Project (Asia)

Convergence invites all those interested to participate in a Consultation Session on the Scale Private Investment Mobilization Project.

Convergence Scale Private Investment Mobilization Project

Blended Finance in Fragile Settings

Fragile countries present some of the most challenging environments for private capital to invest in. Blended finance offers a structured approach that can help mitigate these risks and attract private capital into sectors critical for the development and stability of these countries.

This session will feature two Convergence members, European Bank for Reconstruction and Development (EBRD) and KIVA, who have successfully deployed blended finance structures in fragile contexts to enable impactful investments in areas such as essential infrastructure and refugee services. These organizations will share their experiences structuring and executing transactions, including how they approached risk, ensured conflict-sensitivity, and engaged local stakeholders.

The session will begin with a short presentation of Convergence’s latest data brief on blended finance in fragile and conflict-affected states, followed by a case study presentation from each speaker organization. Participants will gain insights into practical structuring strategies, key challenges and solutions, and real-world examples from fragile and conflict-affected regions.

Member Training: Blended Finance in Fragile Settings

Join us as we explore innovations in blended finance from fragile settings.

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Tuesday, June 17, 8:00am – 9:00am ET

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Convergence is working on the __Scale Private Investment Mobilization Project__ - with UN DESA, UN ECA, OECD DAC members, Gates Foundation and others – to identify the best solutions that will mobilize private investment at scale, fully aligned to the upcoming Financing for Development 4 (Ff4D) Outcome Document. The solutions will use MDB and DFI capital optimally and as little ODA/ODA-like money as possible to mobilize private debt and equity investment to significantly higher volumes to fund private sector and public sector projects in emerging markets. This can only be achieved with high alignment with the developing countries' priorities/ownership and debt sustainability.

We believe that we do not have a monopoly on the best solutions to mobilize private investment at scale, nor to simplify and standardize blended finance. In this regard, Convergence invites all those interested to participate in a 60-minute Consultation Session to: i) learn more about and get a status update on the Scale Private Investment Mobilization Project, ii) engage in open discussion and provide feedback on the list of Private Investment Mobilization Models proposed by Convergence; and iii) help inform the creation of an overall Action Plan for more effective, efficient, and fair deployment of catalytic and concessional capital in developing countries for scaled mobilization.

We encourage all participants to visit the [home page](https://www.convergence.finance/standardization) for the Scale Private Investment Mobilization Project and familiarize themselves with the core project documents prior to the session.

Information Session and Consultation on Convergence Scale Private Investment Mobilization Project (North America/Europe)

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__Thursday, June 12, 11:45am – 1:00pm CST__

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Convergence invites you to a networking event with members and partners in Mexico City during [Pro Mujer's GLI Forum Latam 2025](https://gliforumlatam.com/en/). The session will bring together Convergence's members, partners, and other innovative finance stakeholders to connect with like-minded individuals and institutions engaged in blended finance, make new contacts, exchange ideas, and more.

*Registration is open on a first come, first served basis.*

Member Networking Reception in Mexico City

Join us for a member networking reception in Mexico City, Mexico.

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__Wednesday, June 11, 5:30pm – 6:30pm GMT__

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UNCDF and Convergence are hosting an official reception during the [Africa Impact Summit](https://africaimpactsummit.org/) in Accra, Ghana, from 11 – 13 June 2025. The session will bring together various stakeholders within the innovative finance ecosystem to connect with like-minded individuals and institutions engaged in innovative finance, including blended finance, make new contacts, exchange ideas, and more.

*Attendance is limited to conference participants only.*

Member Networking Reception in Accra

Join us for a member networking reception in Accra, Ghana.

Inside the Deal: responsAbility Climate Smart Food Systems Fund

__Inside the Deal: responsAbility Climate Smart Food Systems Fund, June 3, 2025, 9:00AM - 10:00AM ET__

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Explore the inner workings of real blended finance transactions through Convergence's "Inside the Deal" webinar series. Each quarter, we delve into a successful deal, inviting the deal sponsor and key stakeholders to offer candid insights on structuring these intricate transactions.

In our upcoming webinar, we will feature responsAbility Climate Smart Food Systems Fund—This fund provides long-term expansion debt to innovative agribusinesses in Asia Pacific, Latin America and Africa with the goal of mitigating climate change, reducing food loss and promoting climate change resilience across the agricultural value chain.

During this hour-long webinar, responsAbility will walk us through the structure of the fund and their fundraising journey. We will also engage in, in-depth interviews with key stakeholders, uncovering valuable lessons learned along the way. The webinar will conclude with an open Q&A for all participants.

*This webinar is open to Convergence members only.*

Join us to learn about responsAbility Climate Smart Food Systems Fund.

Inside the Deal: responsAbility Climate Smart Food Systems

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Monday, May 26, 3pm – 4pm SGT (9am – 10am CET)

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Are you new to the Convergence platform? Join us for this interactive session to learn how to navigate Convergence’s blended finance data, deal flow, and events calendar. A team member will walk you through the different functions on our website using real world case examples. Together we will search the historical deals database for a particular transaction type, navigate the investor database to find the top 10 impact investors for a particular sector, and much more.

This session will use an interactive format to answer members’ frequently asked questions. Join us to discover how to use Convergence’s blended finance data in your day-to-day work.

This session is open to all Convergence members.

Member Q&A Session: How to Navigate Convergence’s Member Platform

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Join us for the virtual launch of our flagship State of Blended Finance report on __Wednesday, May 21 at 9:00AM ET__, where we will share updated data trends on the blended finance market from 2024. 

This year's report will also evaluate the market’s progress in overcoming key challenges, including the lack of private sector mobilization strategies amongst most donors, the need for better local capital mobilization, and the urgency of transparency and standardization. In light of the significant decline in ODA, this report will also explore how the blended finance market will be affected, and outlines calls to action for the field.

In addition to presenting highlights from the report, the virtual launch will also feature a panel discussion exploring how blended finance will fare in a landscape of reduced ODA.

The panel will include:

__Marie Aimee Boury__, Head of Impact Based Finance, Société Générale 
__Iftin Fatah__, Senior Program Officer, Development Policy & Finance, Gates Foundation 
__Sarah Marchand__, Director, Capital Solutions, British International Investment 
__Nick Darrant__, Special Advisor, Ministry of Finance, Rwanda

Explore past State of Blended Finance reports [here](https://www.convergence.finance/state-of-blended-finance). Our climate-focused State of Blended Finance report will be released in Fall 2025.

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Watch a recording of the launch below:

https://www.youtube.com/watch?v=necIXpxuf5Y

2025 State of Blended Finance Virtual Launch

Join us virtually for the launch of the 10th edition of our flagship State of Blended Finance report on Wednesday, May 21 at 9:00AM ET, where we will share data, trends, insights, and recommendations from the report.

2025 State of Blended Finance Launch

__San Francisco, June 3, 2025__ – The Catalytic Climate Finance Facility (CC Facility), which provides working capital and technical support to accelerate high-potential climate finance vehicles, has awarded USD 1.1 million to its third cohort of blended finance solutions, including the [Emata Special Purpose Vehicle](https://www.ccfacility.org/portfolio/emata-special-purpose-vehicle), the [Good Fashion Fund 2.0](https://www.ccfacility.org/portfolio/good-fashion-fund-2-0), and the [Nordic Impact Funds](https://www.ccfacility.org/portfolio/nordic-impact-funds).

The CC Facility is designed to accelerate the implementation of financial structures that mobilize private capital for climate action in emerging economies by offering grant funding of up to USD 500,000.

The Facility and its team of experts also provide up to 18 months of tailored technical assistance to address barriers and maximize opportunities to increase the investment pipeline.

“We are delighted to collaborate with three new cutting-edge concepts in climate finance. These mechanisms stand out from a competitive field of applicants as instruments with near-term potential to address severely under-financed sectors in countries struggling to meet their 2030 Agenda objectives,” said Barbara Buchner, CPI’s Global Managing Director.

“Climate finance matters because it enables countries, especially in emerging markets, to reduce emissions and build resilience while also creating new economic opportunities,” Buchner added.

The CC Facility is a partnership between [Climate Policy Initiative](https://www.climatepolicyinitiative.org/) (CPI) and [Convergence](https://www.convergence.finance/).

It targets one of the main obstacles in expanding blended climate finance by streamlining the acceleration stage, when projects face a critical phase as they try to appeal to different markets.

The Facility has three anchor donors: the [Bill & Melinda Gates Foundation](https://www.theglobalfund.org/en/private-ngo-partners/resource-mobilization/bill-melinda-gates-foundation), [Global Affairs Canada](https://www.international.gc.ca/global-affairs-affaires-mondiales/home-accueil.aspx%3Flang=eng), and [Australia's Department of Foreign Affairs and Trade](https://www.dfat.gov.au/).

__A snapshot of the pilot projects:__

1. The [Emata Special Purpose Vehicle](https://www.ccfacility.org/portfolio/emata-special-purpose-vehicle) is a Ugandan digital financing provider specializing in climate-smart agriculture solutions for smallholder farmers. These groups often struggle to access finance to adopt the latest technologies and practices. This lack of capital leaves them increasingly exposed to the effects of climate change, such as erratic weather, that undermine their productivity and income.
2. The [Good Fashion Fund 2.0](https://www.ccfacility.org/portfolio/good-fashion-fund-2-0) sets out to create systemic change in the textile and apparel industry by financing the implementation of high-impact production technologies in Asia. The Fund targets long-term USD debt investments in manufacturing in India, Bangladesh, and Vietnam.
3. The [Nordic Impact Funds](https://www.ccfacility.org/portfolio/nordic-impact-funds) invests in financially viable businesses led by social entrepreneurs dedicated to achieving sustainable development across East Africa. Its mission is to support small and medium-sized enterprises (SMEs) that contribute to improved livelihoods, climate adaptation, and better access to essential services for marginalized groups.

__About the Catalytic Climate Finance Facility__
The [Catalytic Climate Finance Facility](https://www.ccfacility.org/) (CC Facility) is a solution to scale climate finance by filling a market gap in mobilizing private capital. The CC Facility provides a range of services to market-ready blended finance vehicles in developing economies to help them expand their reach. Through grant funding, technical support, and a learning hub, the CC Facility accelerates the implementation of high-impact financial structures while providing resources to the broader ecosystem on how to best catalyze climate finance. The initiative is a partnership between [Climate Policy Initiative](https://www.climatepolicyinitiative.org/) (CPI) and [Convergence](https://www.convergence.finance/).

__Media Contacts__ 
__Sijia Yi__ 
Head of Communications 
Convergence Blended Finance 
sijia.yi@convergence.finance 

__Júlio Lubianco__ 
Communications Manager 
Climate Policy Initiative 
julio.lubianco@cpiglobal.org 

__Sarah Barden__ 
Senior Communications Associate 
Climate Policy Initiative 
sarah.barden@cpiglobal.org

CC Facility awards USD 1.1 million in grants to scale climate investment opportunities in Africa and Asia

CC Facility awards USD 1.1 million in grants

Nature is no longer just in the domain of philanthropic actors. Instead, it's quickly becoming a largely untapped investment opportunity for asset managers and institutional investors alike. This was a key message at the inaugural [Nature Finance Forum](https://events.climateaction.org/nature-finance-forum-europe/), hosted in Paris in April 2025. 

Despite the growing urgency around safeguarding the natural environment, the market for nature is nascent and the $700 billion annual financing gap [needed](https://www.weforum.org/publications/nature-finance-and-biodiversity-credits-a-private-sector-roadmap-to-finance-and-act-on-nature/) to adequately fund it can seem daunting. At the forum, speakers shared insights on how to close that gap. A common thread was the growing necessity for blended finance structures within nature-positive transactions.  

Blended finance [can be used](https://www.convergence.finance/resource/state-of-blended-finance-2024-climate-edition/view) to overcome perceived and actual risks in these transactions and to meet investor requirements regarding risk-adjusted returns. Several speakers throughout the day shared their experiences with using blended finance to launch transactions that directly contribute to nature-positive outcomes.  

__Blended finance models in action__

One example shared by Nick Oakes, Co-Founder & Managing Director of Impact Earth, was the use of concessional capital and guarantees within the __Amazon Biodiversity Fund__. The fund [supports](https://www.impactearth.co.uk/abf) sustainable businesses through venture financing to deliver lasting benefits for biodiversity and communities across Brazil’s Legal Amazon. 

The $50 million fund benefits from a “double-de-risking” structure, using both concessional capital in the junior tranche to absorb first losses and a concessional guarantee to protect investors in the senior tranche. Oakes shared that blended finance was an important tool for mobilizing private capital because investors [may perceive](https://www.convergence.finance/api/file/273be9897ffcb4eef1b24f3a5b9061ab:d8f7e0336ea0041c318853bceeae1295e1c940f8dd5e4c335a3fb525b440957230b864d8845b66e8be08e93d8097ccb4c0e777330b37ab437fa5f150ee21f47d28cf4a81fbe11a46b0a41e4613f9433d7f6b4556289503bd78e689a0dbe6241dd9af74ba163f43ff76194d3a5b77250076b7a443d4041650d47f2c3430633766a2bfa5968af9e68133fddd29883b1d98) higher levels of political risks within Brazil and climactic risks within the Amazon biome. The various concessional instruments allowed the risk-return expectations to align with private investors. 

Attendees then heard from a panel of speakers about a blended initiative called the __Tropical Forest Forever Facility__ (TFFF), created at COP28 in November 2023. Aiming to protect tropical forests across 80 countries, the TFFF seeks [to mobilize](https://www.reuters.com/business/environment/brazil-proposes-global-forest-conservation-fund-cop28-2023-12-01/) up to $250 billion in funding. 

The facility is composed of two parts: a smaller portion from governments and philanthropies that would provide loans, grants, and guarantees, and a larger portion that would use senior debt to mobilize international capital. This fund would, in turn, invest in fixed income portfolios that would be expected to generate higher returns to repay principal investments. The yield from the difference between the funding cost and the investment return would be used to pay countries that achieve the goal of zero deforestation through fixed payments based on each hectare of forest that is conserved. Once again, panelists stated the need for a blended structure to mobilize private investors into an unfamiliar transaction with higher levels of potential risk. 

A third example shared was the work that The Nature Conservancy (TNC) has done through its __Blue Bonds for Ocean Conservation__ initiative. The program [enables](https://www.nature.org/en-us/what-we-do/our-insights/perspectives/an-audacious-plan-to-save-the-worlds-oceans/) island and coastal nations to use debt restructuring to secure lasting sustainable funding that supports the protection of 30% of the world’s oceans, fosters sustainable economic development, and enhances climate adaptation.  

Beatriz Merino, Financial Institutions Lead, Europe at TNC, spoke about the use of blended finance within the program, in particular how catalytic guarantees from the Inter-American Development Bank were critical to mobilizing private debt for their bond program. Merino further stated that TNC is seeing new actors participating in blended transactions, both as commercial investors and as catalytic capital providers.  

__Challenges to financing nature remain__

Despite the exciting potential for blended finance to help close the nature financing gap and the growing interest from new actors, speakers and attendees stressed that there are larger, systemic challenges that continue to cause private investor hesitation.  

Two of the most frequently mentioned challenges were issues with data availability and a lack of metric standardization. Regarding the first challenge, data is not consistently available or at a high enough quality to support the accurate risk assessment of nature degradation across a portfolio of investments, or to allow complete performance tracking or target-setting at the community level.  

One way the Finance for Biodiversity Foundation is trying [to increase](https://www.financeforbiodiversity.org/about-the-pledge/) data transparency is through encouraging signatories of its Finance for Biodiversity Pledge to collaborate and share knowledge; engage with companies; assess impact; set targets; and publicly report on the previous findings. At the forum, the Foundation announced that it had recently reached 200 signatories, an encouraging sign of increased commitment to collaborating on nature financing initiatives. 

Compounding the issue of data availability, however, is the lack of standardization. Even where data is available, it is often highly transaction- or location-specific, leading to a lack of fungibility. Given the bespoke nature of many of these measurement frameworks, transaction costs can become quickly prohibitive for deal sponsors and lead to cumbersome due diligence on behalf of investors. Organizations attending the event, such as the International Advisory Panel on Biodiversity Credits (IAPB) are attempting to address this challenge within the biodiversity credit market. IAPB recognizes that a global solution to biodiversity measurement is not feasible. Rather, the organization has [created](https://www.iapbiocredits.org/framework) a framework with a set of criteria through which projects or transactions can be measured and verified.  

Blended finance instruments can also be useful to address these challenges; providing working capital to early-stage transactions through design-funding grants can help the transactions align with internationally recognized frameworks or to set up robust measurement processes to better understand nature impacts. 

__Final thoughts__

Overall, the day left attendees with a few main takeaways: 

- The impact of nature degradation has left massive, exposed risks across the portfolios of investors globally. The question is no longer if nature should be considered, but how and through what methods.
- Blended finance can be an important structuring approach to align the risk-return expectations of nature-positive transactions with those of private investors.
- New actors are entering the sector at an increasing rate, and every actor has an important role to play, from insurers to multilateral development banks to foundations.
- Challenges remain regarding data accessibility and standardized frameworks, but efforts are being made to align methods where possible.

As momentum builds and blended finance models continue to prove their potential, the path forward will depend on collaboration, innovation, and a shared commitment to protecting nature. Bridging the nature financing gap is a complex challenge, but the Nature Finance Forum Europe showed that it is one that the financial sector is increasingly ready to meet. The time is now for investors, policymakers, and development actors to move from discussion to deployment, and turn ambition into action for nature. 

Blended Finance for Nature: Insights from the Nature Finance Forum 2025 

Insights from the Nature Finance Forum 2025 

The Development Bank of Rwanda (BRD) provides long-term financial services to support Rwanda's development. Since 1967, BRD has driven sustainable economic transformation and prosperity in Rwanda. Its mission is to finance projects that align with Rwanda’s 2050 vision, socio-economic goals, and global Sustainable Development Goals by offering affordable, long-term, and customized development finance.

We spoke to Fernand Kamanzi, Head of Strategy, Research, M&E, and Resource Mobilization at BRD about their work to help achieve the Sustainable Development Goals (SDGs) in Rwanda, how they engage in blended finance, how they measure impact, their gender strategy, and much more.

__Tell us about BRD’s mandate and how your strategy encourages capital mobilization to the SDGs.__ 
BRD plays a crucial role in the economic development of Rwanda, with a mandate focused on financing projects that contribute to sustainable development.

The Bank focuses on sectors that are underfunded by traditional financial institutions, such as social infrastructure, agriculture, affordable housing, renewable energy, education, digital economy, green finance, and export. To effectively link its strategy with capital mobilization toward achieving the SDGs, BRD has adopted several innovative approaches:

- __Sustainability-Linked Bonds (SLBs)__: Unlike traditional bonds where proceeds are earmarked for specific projects, SLBs incentivize borrowers by linking interest rates to their performance against predefined sustainability targets. This mechanism encourages BRD to enhance its environmental, social, and governance (ESG) compliance while simultaneously attracting investors interested in sustainable finance.

- __Focus on Key Performance Indicators (KPIs)__: KPIs include, increasing the percentage of participating financial institutions (PFIs) demonstrating robust Environmental and Social Management System (ESMS) implementation to 75% in 2028 from 0% in July 2023, increasing the number of loans to women-led SMEs among total SME loans to 30% in 2028 from 15.4% in 2022, and increasing the cumulative number of affordable housing loans extended or refinanced by PFIs to 13,000 in 2028, from 544 in 2022. By setting measurable targets, BRD not only demonstrates its commitment to sustainable development but also provides transparency and accountability to investors.

- __Innovative Credit Enhancement Mechanism__: Collaboration with the World Bank through credit enhancement mechanisms allows BRD to reduce risks associated with bond issuance. By leveraging International Development Association (IDA) funds as collateral, BRD can lower borrowing costs and attract a broader range of investors. 

- __Contribution to Capital Market Development__: The successful issuance of SLBs not only benefits BRD but also contributes significantly to Rwanda's capital market development. We contributed towards deepening the capital markets by putting out a new asset class on the market and having a 100% retail allocation policy.

__BRD is among the innovative local development banks in Africa and over the past 12-18 months you’ve issued 2 sustainability-linked bonds (SLB) supported by the World Bank’s IDA private sector window. What was the motivation for structuring these issuances, and what gap were you aiming to fill in the market?__ 
One of the primary motivations for issuing SLBs is to align financial instruments with the SDGs. By structuring these bonds, BRD aims to attract investments that contribute directly to sustainable development in Rwanda, particularly in infrastructure and social projects.

The issuance of SLBs also provides BRD with an innovative financing mechanism that allows access to capital from investors who are increasingly prioritizing ESG criteria in their investment decisions. This trend reflects a broader shift in the global financial landscape where investors are looking for opportunities that not only yield financial returns but also generate positive social and environmental impacts.

The backing of the World Bank’s IDA private sector window adds credibility and reduces perceived risks associated with investing in emerging markets like Rwanda. This support enables BRD to offer more favorable terms on its bonds, making them attractive to a wider range of investors.

By issuing SLBs, BRD also aims to fill the gap between financing needed for sustainable projects and the available funding sources by mobilizing private sector investments into projects that may otherwise struggle to secure funding due to perceived risks or lack of investor interest.

__Tell us how the SLBs are blended and how this approach to risk mitigation translated into an increase in investor comfort and interest?__ 
The blending mechanism in these SLBs involves combining concessional finance from the IDA with market-based financing. This approach allows BRD to offer more favorable terms to investors, thereby enhancing the attractiveness of the bonds. The IDA provides guarantees/first-loss cover, which mitigates risks associated with lending to projects that may not have sufficient creditworthiness on their own. By reducing perceived risk, this mechanism encourages more investors to participate in financing sustainable projects.

__BRD has another ongoing SME-financing partnership with Rwanda Green Fund via Ireme Invest. What was the motivation for this partnership and what has been the outcome, so far?__ 
The partnership between BRD and the Rwanda Green Fund (RGF) through Ireme Invest is primarily motivated by the need to enhance access to finance for SMEs in Rwanda, particularly those engaged in environmentally sustainable practices. By collaborating with the RGF, which focuses on promoting green investments and sustainable development, we align financial support with environmentally sustainable goals. 

The Ireme Invest facility has two components: a __Credit Facility__ to provide financing for eligible projects, managed by BRD, and a __Project Preparation Facility (PPF)__ to support project preparation, managed by RGF. Furthermore, BRD provides subsidized loans from the credit facility and RGF provides grants and equity from the project preparation facility.

As of February 2025, several positive outcomes have emerged from this partnership. 

The funding provided through this partnership has enabled numerous SMEs to invest in projects that contribute positively to environmental sustainability including renewable energy projects, waste management solutions, and other initiatives aimed at reducing carbon footprints.

In addition to financial support, we have emphasized capacity building among SMEs. Training programs and workshops have been organized to educate business owners about sustainable practices, financial management, and how to effectively utilize funding for maximum impact.

The partnership has also contributed to overall economic growth in Rwanda by fostering innovation within the SME sector. As these businesses grow and thrive, they create jobs and stimulate local economies.

__How does BRD measure the impact of its blended finance investments?__ 
__Alignment with Strategic Objectives__ 
__KPIs__ 
To quantify the impact of its investments, BRD establishes specific KPIs that reflect both financial performance and social outcomes. These KPIs may include metrics related to job creation, access to finance for underserved populations (such as women-led businesses), and improvements in housing affordability. By tracking these indicators over time, BRD can assess the effectiveness of its blended finance initiatives.

__Third-Party Evaluations__ 
BRD often collaborates with independent evaluators to conduct assessments of its projects. These evaluations provide an objective analysis of project outcomes against predefined benchmarks. This process helps ensure transparency and accountability in measuring impact while also providing insights for future investment strategies.

__Reporting Frameworks__ 
The Bank adheres to established reporting frameworks such as those set by the International Capital Market Association (ICMA) for SLBs. This involves regular disclosures on how funds are utilized and the resulting impacts on targeted sectors. Such reporting not only enhances credibility but also allows stakeholders to understand the tangible benefits derived from BRD’s investments.

__Stakeholder Engagement__ 
Engaging with stakeholders—including beneficiaries, local communities, and investors—is crucial for understanding the broader impact of BRD’s investments. Feedback from these groups helps refine measurement approaches and ensures that projects remain responsive to community needs.

__Monitoring and Evaluation__ 
BRD has a department responsible for monitoring and evaluation (M&E) as well as dedicated M&E officers. The Bank also has an institutional balanced scorecard that measures its impact at an institutional level. Additionally, this year BRD has implemented an impact scoring model to accurately predict the impact of the Bank’s investments. 

__How does BRD apply a gender lens to its blended finance initiatives?__ 
The Bank collaborates with the European Investment Bank (EIB) to define strategic objectives and key performance indicators that mainstream gender equality considerations in its lending and advisory activities. This collaboration aims to enhance women’s economic empowerment in Rwanda by ensuring that financial products and services are designed with a gender-sensitive approach.

Through its partnership with EIB, BRD develops targeted advisory services specifically designed for women entrepreneurs in micro, small, and medium-sized enterprises (MSMEs). These services aim to provide guidance on accessing finance as well as business development strategies that consider the unique challenges faced by women in the entrepreneurial landscape.

Next, the Bank works with local banks and microfinance institutions to design, establish, and promote gender-intelligent financial products and services through African Women Rising Initiative (AWRI). These products are tailored specifically to meet the needs of women entrepreneurs, thereby increasing their access to finance. The initiative focuses on creating an environment where women-led enterprises can thrive through better financial solutions.

BRD also implements capacity-building programs aimed at empowering women entrepreneurs. This includes providing mentoring services that help women navigate the challenges of starting and running businesses. By equipping women with the necessary skills and knowledge, BRD ensures that they can effectively utilize financial resources available to them.

BRD is committed to championing gender equality within its operational framework. The Bank actively implements policies that support women’s access to finance, ensuring that gender equity is a core component of its blended finance initiatives. BRD’s new strategy (2024-2028) aims to increase financed Women-led SMEs by 30% share of the Bank’s portfolio by the end of 2028.

__Based on your experience in blended finance to date, what gaps do you see in the market that need to be filled?__ 
One of the primary gaps in the blended finance market in Rwanda is the limited access to capital for SMEs. Despite their critical role in economic development and job creation, SMEs often struggle to secure financing due to perceived risks by traditional financial institutions. Blended finance can play a pivotal role here by combining concessional funding with commercial investments, thereby reducing risk and attracting more private sector investment into this segment.

There is also a lack of diverse financial instruments that are specifically designed to meet the unique needs of development projects in Rwanda. Current offerings may not adequately address the requirements of sectors such as agriculture, renewable energy, and infrastructure. Developing innovative blended finance products that align with local priorities could help bridge this gap, enabling more effective mobilization of resources towards the SDGs.

Another significant gap is the need for capacity building and technical assistance for both investors and project developers. Many potential beneficiaries of blended finance lack the necessary skills or knowledge to effectively design, implement, and manage projects that attract blended finance solutions. Providing training and support can enhance project viability and improve outcomes, making it easier for investors to engage with local initiatives.

The regulatory environment in Rwanda is supportive when it comes to blended finance, however, it can be improved. There is a need for clearer policies that support blended finance mechanisms, including tax incentives or guarantees that encourage private sector participation. Strengthening these frameworks would facilitate greater investment flows into priority sectors while ensuring alignment with national development strategies.

Lastly, there is a significant gap in data availability regarding the impact of blended finance investments. Investors require robust data to assess risks and returns accurately; however, many projects lack comprehensive monitoring and evaluation frameworks. Improving data collection methods will enhance transparency, allowing stakeholders to make informed decisions based on evidence of impact.

__How do you see BRD’s blended finance activities evolving in the future?__ 
As global awareness around ESG issues continues to rise, BRD is expected to deepen its commitment to sustainability. The Bank’s current strategy emphasizes mainstreaming ESG practices within financial institutions and increasing financing for women-led businesses and affordable housing. This focus will likely lead to more SLB issuances and other financial instruments that prioritize sustainability metrics. By aligning its financing activities with international standards such as those set by the CMA, BRD can enhance its credibility and attract more investors interested in sustainable finance.

BRD’s successful inaugural SLB issuance demonstrates the potential for domestic capital markets in Rwanda. The Bank is likely to continue leveraging these markets to raise funds while reducing reliance on international credit lines. As local investor interest grows, evidenced by the oversubscription of both SLBs, BRD may implement targeted campaigns to engage retail investors further. This could include educational initiatives about blended finance products, thereby fostering a more robust investment culture within Rwanda.

The partnership between BRD and the World Bank has been instrumental in enhancing the former’s capacity for blended finance initiatives. Future collaborations with international financial institutions will be crucial for accessing additional resources and expertise. Such partnerships can facilitate knowledge transfer regarding best practices in blended finance, enabling BRD to innovate further in structuring financial products that meet both local needs and global standards.

Given the evolving landscape of sustainable finance, BRD is likely to explore new financial instruments beyond SLBs that can attract diverse investor bases. These could include green bonds or social impact bonds tailored specifically for Rwandan priorities such as climate resilience or social equity projects. By diversifying its product offerings, BRD can appeal to a broader range of investors who are increasingly looking for impactful investment opportunities.

To effectively implement blended finance strategies, BRD must invest in capacity building within its team and among partner financial institutions. This includes training on structuring complex financial products, understanding risk management in blended finance contexts, and measuring impact against sustainability goals. Additionally, sharing knowledge with other regional development banks could foster collaboration and innovation across East Africa.

Learn about how BRD engages in blended finance,  how they measure impact, their gender strategy, and much more.

BRD member spotlight

Development Bank of Rwanda (BRD) Member Spotlight with Fernand Kamanzi 

*May 20, 2025, Toronto, Canada* - After six months of research and consultations with many countries and organizations, today Convergence launches the [Consultations Report](https://www.convergence.finance/standardization) proposing a Scale Private Investment Mobilization Action Plan to mobilize private investment at scale effectively and efficiently to finance SDG and climate capital investment in Low & Middle-Income Countries. The Action Plan is a practical, comprehensive approach to achieve the private investment mobilization objectives and standards of the Financing for Development 4 Outcome Document (using existing development finance resources). Convergence will continue to hold consultations in May and June and transform the Consultations Report into an Interim Report by June 30, 2025 ahead of the Financing for Development Forum (FfD4) in Sevilla.

The Consultations Report has been prepared as part of the Scale Private Investment Mobilization Project, led by Convergence and funded by the Gates Foundation, Finland, France, Luxembourg, and Switzerland. The Project was set up to help blended finance and private investment mobilization to deliver on their potential and the expectations to be agreed in Sevilla. The aim is to scale up proven models that deliver impact and investment at scale instead of continuing fragmented, customized, and increasingly complicated blended finance designs.

“The proposed Scale Private Investment Mobilization Action Plan would represent a decisive step forward in aligning international efforts, reducing complexity, and ensuring that development and climate finance are fit for purpose in today’s global investment landscape”, said Chris Clubb, Managing Director at Convergence.

A significant part of the Action Plan is the proposed package of 12 Private Investment Mobilization Models (PIMMs) identified by Convergence and others as most effective and efficient way to standardize and scale SDG and climate investment in developing countries. The PIMMs are based on a review of historical mobilization transactions that (i) have demonstrated effective and efficient mobilization and (ii) have best potential to mobilize private investment to/within developing countries in the quantity and quality necessary for sustainable development.

The package of 12 PIMMS is identified by Convergence and is proposed to include: 
- Two PIMMs that help increase the number of viable projects through using public funding to co-fund early-stage project development in high-impact sectors like renewable energy.
- Five PIMMs that improve project-level investability through reducing risk at project level, such as funding organizations that issue investment-grade guarantees to mobilize lenders to finance important projects they would otherwise not be able to finance.
- Three PIMMs that enhance portfolio-level investability through tiered blended finance funds, structured to create investment-grade bonds and notes in senior capital through the strategic use of concessional and non-concessional public sector funding.
- One PIMM addresses FX risk – to mitigate currency risk for countries, projects and investors
- One PIMM is dedicated to domestic financial and capital markets development – as prioritized in the FfD4 Outcome Document

Together, these 12 PIMMs provide a standardized and scalable roadmap for mobilizing domestic and cross-border private investment—designed to be practical, replicable, and aligned with existing regulatory and market contexts - and identify how donors and developing country governments can best utilize their scarce finance resources to catalyze the private sector capital necessary to generate development outcomes.

No one organization has a monopoly on which mobilization models should be of priority to standardize. Therefore, the proposed Action Plan is grounded in not only Convergence’s empirical review of around 1,500 blended finance transactions but also consultations with more than 100 stakeholders across developing countries, OECD Development Assistance Committee countries, multilateral development banks, development finance institutions, philanthropic foundations, and private investor groups. Convergence will continue to lead an extensive consultation process through 2025, engaging with key global stakeholders to finalize the Action Plan and final package of PIMMs. 

*Learn more about the Scale Private Investment Mobilization Project [here](https://www.convergence.finance/standardization).*

__About Convergence__ 
Convergence is the global network for blended finance. Convergence’s Blended Finance Accelerator supports blended finance practitioners with design grants, acceleration support, and market intelligence to scope, structure, and launch new blended finance solutions that unlock commercial investment to accelerate sustainable development in emerging markets.

On top of market acceleration through its Blended Finance Accelerator, Convergence generates blended finance data, intelligence, and deal flow to increase private sector investment in developing countries. Convergence’s global membership includes over 160 public, private, and philanthropic investors as well as sponsors of transactions and funds.

__Media Contact__ 
Sijia Yi 
Head of Communications, 
Convergence Blended Finance 
sijia.yi@convergence.finance

Convergence Launches Consultations Report to Scale and Standardize Private Investment Mobilization for Developing Countries 

Convergence Launches Consultations Report

*Toronto, 21 May, 2025* — Today, Convergence, the global network for blended finance, launches the 2025 Spring Edition of its flagship report, the State of Blended Finance, which offers a snapshot of the overall market in 2024, including investor and deal trends. 

Following record-high volumes in 2023, this report found that the blended finance market remained steady through 2024. Blended finance deal flow was higher in 2024 than the market average for the past five years, with 123 deals reaching close totaling $18 billion in financing. At the same time, deal sizes were trending upward, with the median size increasing from $38 million (2020 - 2023) to $65 million (2024) — reflecting growing ambition and scale. Median deal size was bolstered by three transactions exceeding $1 billion.

The report also found that there was more buy-in from the private sector. Commercial capital from private sector investors outpaced DFIs and MDBs in capital deployment, with $6.9 billion in investments in 2024. 

“This report comes at a critical time as we see unprecedented cuts to ODA across the board and the dismantling of USAID, one of the most frequent investors in blended finance amongst official donor agencies,” says Joan Larrea, CEO at Convergence. “This current report looks at data from 2024, and will not reflect the impacts of these new challenges, which will no doubt be felt in the market this year and beyond. Instead, it offers a critical snapshot of the period before, and will be the year against which the future will be benchmarked.” 

Development agencies and multi-donor pools have been the primary contributors of concessional capital, over the last three years they have contributed $5.1 billion in concessional capital, accounting for 65% of total concessional commitments. This report found that there is a maturation in how development agencies disburse concessional capital, moving from grants (41% in 2022 to just 10% in 2024) to risk-sharing instruments such as guarantees and senior debt, with guarantees rising from 11% to 27% and senior debt from 19% to 24% from 2022 to 2024.

Impacts from the war in Ukraine were felt in the blended finance market in 2024. Europe and Central Asia, historically underrepresented in the blended finance market, saw its share of deals rise from 10% in 2022 to 23% in 2024. The financing flows also rose significantly, from $2.8 billion in 2022 to $5.9 billion in 2024. This surge was largely driven by support for Ukraine, with a focus on the country’s economic stabilization, liquidity support, and continued access to essential services. 

“Yet, despite positive signals from the blended finance market in 2024, scaling blended finance will require more than select large transactions and moderate market growth. A lack of structural standardization continues to slow the rollout and replication of blended structures, and in many cases, concessional capital mobilizes public commercial funding from MDBs and DFIs rather than private investment,” says Ayesha Bery, report author and Associate Director, Content, at Convergence. 

Finally, this year’s report assesses the progress made over the past five years across the key challenges that blended finance faces, including the lack of private sector mobilization strategies amongst most donors, the need for greater levels of local capital mobilization, and the urgency of transparency and standardization. It also explores how the reduction in ODA will impact these challenges.

Analysis in the report draws from Convergence Market Data, the largest and most detailed database of historical blended finance transactions, comprising 1,350 blended finance transactions with a total investment of $249 billion.

__About Convergence__ 
Convergence is the global network for blended finance. We exist to increase private investment in emerging markets and developing economies to advance the UN Sustainable Development Goals and Paris Agreement.

Our members include private investors looking to diversify their portfolios, businesses seeking capital, as well as public agencies and philanthropic foundations looking to make their funds go further.

__Media Contact__ 
Sijia Yi 
Head of Communications 
Convergence 
sijia.yi@convergence.finance

Convergence has launched the 2025 Spring Edition of its flagship report, the State of Blended Finance, which offers a snapshot of the overall market in 2024, including investor and deal trends.

Convergence finds blended finance market held strong in 2024

Convergence report finds blended finance market held strong in 2024

Tri-Sector Associates (TSA) is an end-to-end impact firm that partners with government, private sector, and civil society organizations in Singapore and across Asia to tackle emerging societal challenges, with a focus on education/skill building, health, and climate. They do this by bringing these different sectors together through new collaboration models, including blended finance, and variations of pay for success (as a subset of blended finance), such as social impact bonds, social impact guarantees, and outcomes amplifiers. TSA utilizes a ‘for Asia, by Asia’ model to address the local nuances inherent in their work.

We spoke with Chris Glotfelter, Senior Project Leader at TSA about how they engage in blended finance, their priority sectors, challenges they have faced in the blended finance space, and more.

__How do you engage in blended finance? How has your approach evolved?__

TSA is committed to supporting the evolution of funding systems through cross-sector collaboration to ensure more (and more impactful) funding is allocated to projects that progress the Sustainable Development Goals across Asia. This requires innovative financing approaches and mechanisms, which is where blended finance comes into play. Our work focuses on three thematic areas: education/skill building, health, and climate/environment. 

As concessional capital is typically the more difficult part of the blended finance equation, especially as donor funding is being cut back, we come at it from this angle: working with foundations, family offices, and government to seed blended finance projects. This is typically the first time these organizations have waded into blended finance, so we allow them to dip a toe in by undertaking what we call a ‘sequential blended finance approach.’ Essentially, philanthropic capital goes in first to seed an opportunity and mature it to the point that it is commercial capital ready, often while structuring a mechanism to recycle the philanthropic capital into a later stage of growth or into a separate opportunity. This increases the leverage of each concessional dollar committed. Engaging with organizations in this way allows for a smoother transition into blended finance compared with the blended fund approach.

__Can you tell us about any specific blended finance projects/programs you’ve worked on?__

As a firm that began with a core focus on pay-for-success projects, later branching out to innovative and blended finance, we have quite a few examples. Two are outlined below, demonstrating how the funding models unlocked new benefits:

__A. Conservation International Recyclable Technical Assistance Facility (TAF)__ 
There is a significant pipeline of nature-based solutions (NbS) projects in the Asia Pacific region. However, many of these projects are not yet investment-ready because of knowledge gaps in the financial, operational, and technical aspects of these projects. This increases their perceived risk-level and does not fit the current preferences of NbS investors. Conservation International sought to accelerate the investment readiness of these projects and commissioned Tri-Sector to assess the landscape of potential blended finance options, taking into consideration the specific geography and nature of the issue. A technical assistance facility (TAF) was developed where capital allocated to projects would be recycled back into the TAF upon investment into the project. Through this structure, $12 million in philanthropic commitments were made, which sought to catalyze over $100 million in commercial capital for NbS projects. Due to the recyclable nature of the TAF, donors saw that their capital was highly catalytic, paying repeat dividends. Since then, 14 projects in seven countries across the region have received support from the TAF, with some being able to provide repayments back to the TAF.

__B. [Skills for Success](https://www.linkedin.com/feed/update/urn:li:activity:7247123147248816128/) Outcomes Amplifier Model__ 
Skills for Success is a pay-for-success project tackling the problem of Singaporean youth not in employment, education, or training (NEETs), by providing free-of-charge access to a skill building program with a monthly stipend to offset living cost considerations. Based on the [Outcomes Amplifier model](https://ssir.org/articles/entry/keeping_the_social_impact_going_when_a_pilot_project_ends), which was pioneered by Tri-Sector, additional funding is allocated to the program based on verified outcomes, which is then used as a pay-it-forward model to fund the next round of learners. 

In this model, Temasek Holdings (TH) and UBS Optimus Foundation (UBS-OF) provide the upfront funding to kick off the program and cover the monthly stipends. Generation Singapore, as the service provider, oversees the training program and provides soft skills training, along with placement services. Upon achieving verified outcomes, the Institute of Policy Studies (part of the Lee Kuan Yew School of Public Policy at the National University of Singapore) provides the outcomes funding to fund the next round. Capital is blended in the early stage of the program, with up to 30% of the funding coming from TH and UBS-OF, while at least 70% of the remainder of the funding comes from the government in the form of SkillsFuture funds. This cross-sector collaboration model is a key reason all the partners have bought into this project, with the view that this pilot can become replicable and scalable elsewhere in Southeast Asia.

__What innovative blended finance solutions have you recently implemented or are you currently exploring?__

Currently, we are working on a number of solutions. One of the most interesting, in relation to a key environmental challenge at present, is the use of philanthropic capital to support just transitions related to the early retirement of coal-fired power plants in Southeast Asia. The blending required here, and the additionality sought by philanthropic capital, is not straightforward and requires thinking outside the box to create a win-win-win situation for private, public, and philanthropic organizations.

__What sectors and focus areas are your priorities? Where do you see maximum potential to scale blended finance in the region?__

Recently we have seen a lot of interest in two areas: i) skill building; and ii) the intersection of climate and health. With regard to skill building, we have seen great interest in ethical income share agreements – those which do not make learners worse off than if they were able to access student loans or other educational financing – which typically requires some concessionality, rather than a pure commercial mindset. However, the area with greater potential is at the intersection of health and climate, where we are seeing an emergence of sub-themes including heat-related illnesses, water and food security, mental health impacts, and ocean-linked economic livelihoods. Although both health and climate are relatively well understood on their own, the themes at their intersection are just now coming into focus and being better understood, with new interventions being developed. Blended finance opportunities in this space will need to address how impact-first businesses can scale and become sustainable while being at the leading edge of adaptation solutions that are seen as less interesting (and commercially viable) than mitigation solutions. As a region that will be highly impacted by climate change, Southeast Asia is a strong focus in this space.

__How do you measure impact and evaluate success for your blended finance activities?__

We focus on both traditional and emerging impact indicators. On the traditional side, we track the leverage multiplier created using concessional capital to attract commercial capital. On the emerging side, we focus on the wider ecosystem impacts of blended finance, such as the new entrants to blended finance transactions and whether blended finance projects unlock wider incentives (e.g., the Monetary Authority of Singapore’s tax incentives for family offices1).

__Do you apply a gender lens in your work?__

Though we do not apply a blanket gender lens across all our work, we certainly have seen opportunities to make gender a meaningful part of the conversation. One recent example is the [Skills for Success program](https://www.linkedin.com/feed/update/urn:li:activity:7247123147248816128/) which was launched based on the Outcomes Amplifier Pay-for-Success model using funding from TH, UBS-OF, and the Institute of Policy Studies. Given females are highly underrepresented in technology-related roles in Singapore, one of the program targets was to have female participants reach parity with males over the course of the program. This has the added benefit of creating impact beyond the target beneficiaries (at-need youth), drilling down to who would benefit most from the program’s interventions.

__What are some interesting or unexpected challenges Tri-Sector Associates has faced while navigating the blended finance space?__

One of the unexpected elements that we have encountered has been large banks coming to us and wanting to do more in the blended finance space, but being faced with challenges in two areas: i) a lack of a voluminous pipeline of projects; and ii) not enough access to philanthropic capital to meaningfully support projects that are of a sufficient size to make sense for their clients. This shows us that more must be done in the ecosystem to build the components of blended finance before it can truly proliferate in the global market.

__What advice do you have for other non-profit and social enterprises interested in participating in blended finance?__

Being able to ‘speak the language’ of both commercial and concessional capital providers is critical to participating in blended finance. We find that when organizations cannot communicate efficiently, nothing gets done. If you are finding that this is the case, consider hiring an intermediary who can ‘translate’ between all the parties and create cross-sector alignment. This will naturally be an added cost, but will save time and money throughout the process, and many times is the critical factor in whether the project launches.

__Given TSA is a part of the larger Temasek Trust family, how do you collaborate with other entities internally to bring the collective experience of the Temasek group to clients and stakeholders and advance the ecosystem in Asia?__

We are so thankful to be a part of Temasek Trust’s ecosystem, which enables us to support meaningful causes across its network – both in Singapore and the wider region. Our collaborations take various forms: we introduce new ideas, they bring potential projects to us, or we co-create new initiatives. This versatile approach has been key to fostering strong partnerships, as engagement is shaped by the unique needs and opportunities of each collaboration. Likewise, our collective support for the broader ecosystem is not one-size-fits-all, as everyone requires a tailored approach to deliver meaningful impact.

The diversity of the Temasek Trust ecosystem allows us to shape projects that span commercial, concessional, and purely philanthropic capital, while drawing on deep thematic expertise. This convening capability, combined with the ability to bridge perspectives across different sectors, is one of TSA’s value-adds for our partners both within the Temasek Trust ecosystem and beyond. When like-minded partners come together with a shared purpose, the results can be truly transformative.

__How do you see TSA’s blended finance activities evolving in the future?__

As our deal sizes increase over time, we envision more engagement with multilateral development banks and development finance institutions to support the quantum of funding required to finance these projects. Naturally, this could come in the form of a fund. We are especially seeing interest from organizations regarding the management of purely philanthropic funds (e.g., technical assistance facilities), these sit outside of the typical remit of fund managers on the commercial side who are also willing to blend some concessional capital into these funds. Given our strong relationships with philanthropists, this would be a natural next step for TSA.

1. Source: [MAS](https://www.mas.gov.sg/schemes-and-initiatives/fund-tax-incentive-scheme-for-family-offices)

Learn about how Tri-Sector Associates engages in blended finance, their priority sectors, challenges they have faced in the blended finance space, and more.

Tri-Sector Associates Member Spotlight

Tri-Sector Associates Member Spotlight with Chris Glotfelter

*Washington, DC | April 30, 2025* — Convergence announces the fifth and final cohort of its Gender-Responsive Climate Finance (GRCF) Window, at a special event hosted at the Embassy of Canada to the United States, on the sidelines of DC Climate Week. Two innovative blended finance solutions have been awarded grants for proof-of-concept and feasibility study, targeting gender-equitable climate action across the Pacific Islands and Sub-Saharan Africa.

The GRCF Window supports pioneering blended finance solutions at the intersection of gender equality and climate change in emerging markets. Its mission is to mobilize private sector capital at scale to fund climate mitigation and adaptation projects that are inclusive and gender-responsive.

“This final cohort illustrates the breadth of blended finance solutions at the intersection of gender and climate,” says Convergence Senior Director, Market Acceleration and Design Innovation, Leah Pedersen. “These vehicles will create meaningful impact for women in emerging markets, providing much needed opportunities and support while advancing key climate goals with positive regional and global outcomes.”

Funded by Global Affairs Canada, the GRCF Window has supported 11 blended finance solutions with a total of $2.9 million in committed capital. To date, these solutions have mobilized $362 million in additional capital from public, private, and philanthropic investors. While this marks the final round of funding, Convergence continues to provide hands-on portfolio support to grantees to help bring their concepts to market.

__Introducing the Grantees__

__Matanataki Pte. Ltd.__ has been awarded a proof-of-concept grant to develop and launch __Matanataki Pacific Fund 1__, a blended equity fund providing risk capital to reef- and ocean-positive small and medium-sized enterprises in the Pacific Islands. The fund will target the waste management, agriculture, fisheries, and tourism sectors, with a strong focus on gender equity. It will prioritize women-led businesses, promoting financial inclusion, leadership opportunities, and access to resources. The fund aims to include 50% women-led businesses in its pipeline of companies, support 1,200 metric tons per year of sustainably sourced seafood, conserve and restore over 17,000 hectares of marine area, divert 57,000 metric tons of green waste from landfills into fertilizer, train approximately 1,400 small farmers in reef-positive farming practices, and engage with 39 local partners.

This grant will support stakeholder engagement, development of governance and policy frameworks, legal and fund structuring, impact and gender action planning, design of a technical assistance facility, and readiness for fund launch.

__Alitheia__ has been awarded a feasibility study grant to design the __Eco Equity Investment Company (EEIC)__, a dual blended finance vehicle focused on reducing Africa’s gendered housing deficit. The vehicle will initially target Nigeria's housing market, investing in women-led or women-supportive businesses across the green construction value chain, promoting access to affordable and sustainable housing for women while mitigating climate impacts through reduced emissions and resource-efficient building practices. The EEIC aims to mitigate 500,000 metric tons of CO2 equivalent greenhouse gases over the project’s life cycle, support training for at least 300 women entrepreneurs in adopting sustainable practices, and deliver approximately 2000 passive homes to low income communities while ensuring home ownership remains with women.

With this grant, Alitheia will finalize vehicle structuring, conduct viability and market studies, build a financial model, complete risk analysis, develop an incubator pipeline, engage stakeholders, and advance fundraising efforts.

__About Convergence__ 
Convergence is the global network for blended finance. Convergence’s Blended Finance Accelerator supports blended finance practitioners with design grants, acceleration support, and market intelligence to scope, structure, and launch new blended finance solutions that unlock commercial investment to accelerate sustainable development in emerging markets.

On top of market acceleration through its Blended Finance Accelerator, Convergence generates blended finance data, intelligence, and deal flow to increase private sector investment in developing countries. Convergence’s global membership includes over 160 public, private, and philanthropic investors as well as sponsors of transactions and funds.

__Media Contact__ 
Sijia Yi 
Head of Communications, Convergence Blended Finance 
sijia.yi@convergence.finance

Convergence announces the final cohort of its Gender-Responsive Climate Finance Window. Two innovative blended finance solutions targeting gender-equitable climate action have been awarded grants.

Convergence supports 2 innovative blended finance solutions

Convergence awards grants to two gender-responsive climate blended finance solutions

*This op-ed was originally published in [The Business Times](https://www.businesstimes.com.sg/opinion-features/local-investors-needed-combat-climate-change-asia).*

__*Written in collaboration with [Deepali Khanna](https://www.rockefellerfoundation.org/profiles/deepali-khanna/), Head of Asia, The Rockefeller Foundation.*__

The climate crisis is intensifying and compounding an already challenging economic environment of high inflation and pressure on national budgets. With an estimated financing gap of over USD 800 billion per year in developing countries in Asia for climate mitigation and adaptation, there is a critical need to mobilize private sector capital towards climate action at scale. For this to happen, we need to strengthen and grow domestic capital markets in Asia. 

ASEAN and India account for approximately 50% of the financing gap mentioned above. Both have shown strong GDP growth over the last decade, with good savings and investment rates, and sound banking and financial sectors. The domestic capital pool of money from bank deposits, sovereign wealth funds, and public pension funds is estimated to be at USD 7 trillion. There is a massive opportunity to mobilize these local sources of capital towards achieving the region’s climate finance needs.

Local capital participation has distinctive advantages. It has a deeper and more nuanced understanding of local investment landscapes and provides confidence to foreign investors, thus reducing risk perceptions and risk premiums. Moreover, the foreign investors often invest using local currency, thus avoiding currency hedging costs which impact returns on investments for international investors, especially in adverse macroeconomic conditions. Finally, local capital participation stimulates private sector development and builds capacity among local financial institutions into impactful sectors, such as climate finance. 

Despite the clear benefits, participation from local capital remains below what’s needed. There are a few reasons for this: investors’ commitment to domestic development projects has been constrained by regulatory limits, their unfamiliarity with alternative asset classes and how to assess and mitigate risk, low levels of capitalization, and, for pension funds, a fiduciary responsibility to preserve capital.

So how do we mobilize domestic capital? [Blended finance](https://www.convergence.finance/blended-finance), the use of public and philanthropic capital to attract private capital into transactions aligned with sustainable development, is one way to mobilize new sources of capital from local private investors and scale up climate finance.

Historically, blended finance has primarily attracted cross-border flows. This is largely due to the dominant presence of multilateral development banks, development finance institutions, and donors based in developed countries. On average, only 6% of all blended finance flows per annum in Southeast Asia have originated in the target investment country. 

To scale up local capital mobilization with blended finance, there is a need to build the capacity of local stakeholders, develop an investible pipeline of transactions and reduce time to market by focusing on standardization of deals which meet international standards, and create an enabling environment for blended finance that can attract cross-border and local private capital to flow into climate action and other areas where it currently is not. 

Initiatives are underway to address these needs. For example, the Green Climate Fund (GCF) and Nationally Determined Contributions partnership has developed the [Climate Investment Planning and Mobilization Framework](https://www.convergence.finance/resource/climate-investment-planning-and-mobilization-framework/view), which aims to assist country governments with a step-by-step guide for supporting upstream investment planning, such as identifying climate goals, as well as downstream activities, such as identifying project pipeline and financing partners from both local and global investors. The Framework is designed to identify the gaps in capacity or information that are preventing climate finance mobilization and to facilitate the successful implementation of climate change projects and programs with the best financial partner.

Another example is The Rockefeller Foundation’s support of two blended finance initiatives in Asia: Convergence’s [Asia Climate Solutions Design Grant Window](https://www.convergence.finance/design-funding/open-window/Asia-climate-solutions-design-grant) (ACS) and the [Catalytic Climate Finance Facility Learning Hub](https://www.ccfacility.org/learning-hub), a joint initiative by Convergence and the Climate Policy Initiative. 

ACS is a pioneering design funding program that supports the development and launch of innovative blended finance solutions that mobilize private capital for the climate transition in Asia. The funding from The Rockefeller Foundation for ACS will support solutions with innovative models of mobilizing local capital in key markets like Indonesia, the Philippines, and Vietnam. Meanwhile, the Learning Hub aims to gather key data trends, policy initiatives, and draw on critical insights from the ACS portfolio to offer best practices for mobilizing domestic capital. This includes highlighting successful and replicable blended finance structures that have attracted domestic investment to climate finance projects, as well as enabling policies and regulations.  

Ultimately, attracting higher levels of domestic sources of commercial capital into climate transactions will depend on both domestic donors (e.g., national and state governments, local philanthropies and foundations, and national development banks) and international donors (e.g., the Development Assistance Committee of the Organization for Economic Co-operation and Development (OECD), international philanthropies, and climate funds like the Green Climate Fund) deploying concessional resources in a manner that is more interconnected and more explicitly focused on blended finance and private sector mobilization. With just five years until the deadline for meeting the Sustainable Development Goals, there is no time to lose.


To combat climate change in Asia, we need local investors 

With global political stability [facing](https://www.worldbank.org/en/topic/fragilityconflictviolence/overview) significant setbacks in recent years, private sector development [will be](https://beamexchange.org/media/filer_public/67/4b/674b569e-d917-4c2b-a5fc-6133b2389619/msp_pse_in_fragile_and_conflict_affected_situations_primer_final_101321_2.pdf) critical to improving development outcomes and increasing social impact in fragile and conflict-affected situations (FCS). An increase in private investment can help create jobs, foster economic growth, and produce tax revenues to help governments provide essential services to their citizens. Nevertheless, socio-economic, political, and institutional challenges associated with FCS heighten the risks, costs, and complexities of doing business in these contexts. 

According to the World Bank, FCS is defined as two related but distinct concepts. Fragility refers to a condition where a region has extremely low institutional and governance capacity, impeding its ability to function, maintain peace, and promote economic and social development. Meanwhile, conflict represents a condition where acute insecurity arises from the use of deadly force by organized groups–whether state forces, non-state actors, or irregular entities–with a political agenda.

Blended finance has emerged as a method to support responsible private sector development in FCS, complementing reforms to improve the business environment. The value of blended finance is its ability to unlock private investment in new markets or sectors perceived as too risky by private investors. The use of blended finance remains limited within FCS. Using the to select jurisdictions that have appeared consistently from 2019-2023, according to Convergence's Historical Deals Database (HDD), there have been 54 blended finance transactions across 19 jurisdictions, totalling approximately $4.5 billion in aggregate financing. [World Bank’s FCS list](https://www.worldbank.org/en/topic/fragilityconflictviolence/brief/classification-of-fragile-and-conflict-affected-situations) to select jurisdictions that have appeared consistently from 2019-2023, according to Convergence's Historical Deals Database (HDD), there have been 54 blended finance transactions across 19 jurisdictions, totalling approximately $4.5 billion in aggregate financing. 

This article provides a snapshot of our latest member-only data brief on blended finance for FCS, including opportunities and challenges related to increasing the use of blended finance in these regions. 

*Click [here](https://www.convergence.finance/resource/blended-finance-in-fragile-and-conflict-affected-situations/view) for the Blended Finance in Fragile and Conflict-Affected Situations data brief (paywall).* 

## Highlights from the brief:
 

__31% of blended transactions in FCS are in the energy sector__

Most blended finance transactions in FCS target the energy sector, mirroring the broader blended finance market, as this sector tends to be the most commercially viable. In FCS, most energy sector deals take place within the renewable energy sector. 

The [ability](https://ieg.worldbankgroup.org/sites/default/files/Data/reports/chapters/fcs_eval.pdf) of blended finance to broaden investments in sectors that would not otherwise attract funding is crucial for FCS, where economies often depend heavily on extractive industries and agriculture. Blended finance can help overcome challenges associated with an overreliance on these industries by directing private capital to sectors that promote economic diversification, resilience, and stability. However, its deployment must be strategic rather than indiscriminate.

One example of an energy sector transaction was [Nuru](https://nuru.cd/), a company improving electricity access and affordability in the Democratic Republic of the Congo, where less than 20% of the population has access to reliable energy. In 2023, Nuru secured $50 million to [provide](https://disclosures.ifc.org/project-detail/SII/45543/nuru-drc) up to 15 MW of generation capacity across three cities through solar hybrid mini-grid projects, reaching 28,000 households. To improve the company’s commercial viability, the transaction leveraged a mix of concessional instruments, including concessional equity from the Blended Finance for Climate Program, a collaboration between Finland and the International Finance Corporation (IFC), and concessional capital from the Global Energy Alliance for People and Planet and the Renewable Energy Performance Platform. This mobilized additional investments from IFC, and a range of other private and philanthropic investors. The company also secured a [full guarantee](https://www.miga.org/press-release/miga-backs-nurus-solar-hybrid-mini-grid-projects-drc) from the Multilateral Investment Guarantee Agency to cover expropriation, transfer, and war and civil disturbances risks, alongside a results-based financing grant from Clean Energy and Energy Inclusion for Africa for the projects in Goma.

![fig1 blog](//images.ctfassets.net/4cgqlwde6qy0/17L1Coc9GaJDULoDwx7CTt/27e2ce32ae04a03d97a8b93c4c540ebd/fig1_blog.png)
*Figure 1: FCS transactions vs. the overall blended market by sector*

__Concessional debt/equity is the most common archetype, followed by technical assistance (TA) and guarantees/risk insurance__

The blending archetypes deployed in FCS follow trends similar to those in the overall market. The primary purpose of TA [is](https://www.convergence.finance/resource/blending-with-technical-assistance-2023/view) to improve the operational capacity of investees and stakeholders throughout the value chain, lower transaction costs, and foster a more supportive environment for investors. In the specific context of FCS, the role of TA [is](https://www.fmo.nl/fragile-states) further refined and can be used to support investees' compliance with investment requirements, create sector fundamentals and capabilities, assist government programs, and improve the conflict sensitivity of investments.

![fig2 blog](//images.ctfassets.net/4cgqlwde6qy0/6isdbwNQNIE19zIhZsfvt2/f269a74f9557b9f92d66f409398b9578/fig2_blog.png)
*Figure 2: FCS transactions vs. the overall blended market by archetype*

## Challenges and opportunities for blending in FCS:
 

__To reduce structural, financial, and security barriers in attracting private investment in FCS, increase focus on awareness, pipeline development, and de-risking strategies__

Numerous barriers impede private investment into FCS, including limited existing local markets, a small pipeline of bankable projects, structural complexity of formal and informal institutional arrangements, and lower risk-adjusted returns. Blended finance can reduce these challenges by leveraging different forms of concessional capital to address specific barriers. For example, design-stage grants can provide the funding needed to align investment decisions with local contexts and promote collaboration among capital providers to reduce costs and allow for risk sharing. Ultimately, for blended finance projects in FCS to be sustainable in the long-term it is important to continuously engage with local communities and development actors to ensure alignment with local efforts. 

__To ensure that investments do not exacerbate fragility, use TA for conflict sensitivity analysis and select investment opportunities__

To avoid exacerbating the conflict, investing in FCS requires careful design and conflict sensitivity to avoid reinforcing existing grievances and disruptions to local systems. Despite their importance, conflict-sensitive strategy implementation often [fails](https://www.fmo.nl/fragile-states) or is applied post-investment, rather than being an integrated and important criterion throughout the investment selection process. According to Dr. Josie Lianna Kaye, Chief Executive Officer of TrustWorks Global, blended finance can reduce these investment risks by using TA to conduct conflict-sensitivity analysis, which can help companies better deal with the risks and challenges associated with the conflict context in which they operate. Moreover, using TA in this way ensures that the transaction prioritizes conflict sensitivity and can help establish a more stable investment environment. For investors, conflict-sensitivity analysis can help identify and design interventions that foster stability and development and provide a clearer understanding of conflict dynamics. These insights can help investors determine if their support can create meaningful change at the individual, sectoral, or broader community level in the FCS.

Learn how blended finance can be used in fragile and conflict-affected situations to improve development outcomes

Using blended finance in FCS to improve development outcomes

Using blended finance in fragile and conflict-affected situations to improve development outcomes

__San Francisco and Toronto, March 24, 2025__—The Catalytic Climate Finance Facility (CC Facility) has launched its fourth call for applications for high-impact, scalable, and market-ready blended climate finance solutions in developing economies.

The Facility is welcoming new submissions, which can be made through the [CC Facility website until April 24.](https://www.ccfacility.org/apply)

This cycle will target sustainable agriculture solutions in sub-Saharan Africa and South Asia, as well as other climate adaptation and mitigation initiatives across the Asia-Pacific region.

Set up in 2023, the CC Facility offers up to USD 500,000 in grant funding for each selected project. The program also provides tailored technical assistance to all grantees, including support on strategies, fundraising, and operations to help applicants overcome market barriers and effectively mobilize private capital for climate action.

To date, the CC Facility has awarded over USD 4 million to test, structure, launch, and expand 11 blended climate finance solutions globally.

These solutions support a range of initiatives, such as climate-resilient agriculture, marine conservation, biodiversity, climate adaptation, and renewable energy. They do so via blended finance solutions, including debt, project finance platforms, and venture capital.

“The CC Facility highlights the increasing potential for unlocking private capital in a pivotal year for demonstrating the value of sustainable development investments,” said __Barbara Buchner, Global Managing Director of Climate Policy Initiative (CPI)__. 

“It helps mobilize investment in under-financed areas, including private and broader domestic resources, to develop solutions that address the worst impacts of global warming,” she added.

“With foreign aid budgets being cut across the board, initiatives like the CC Facility that are focused on mobilizing private capital to the places and challenges that need it most are more important than ever,” said __Joan Larrea, Chief Executive Officer (CEO) of Convergence__.

“We are thrilled to be backing mechanisms that have the potential to be ecosystem and market builders delivering outsized and lasting impact to the countries and communities they are located in,” explained Larrea.

Amid calls for the existing global climate finance architecture to evolve, the CC Facility is a partnership between Convergence and CPI that aims to provide holistic solutions to accelerate the implementation of blended finance structures while catalyzing private capital.

__Register for the information session__ 
To learn more about the program, including eligibility and selection criteria, and ask our team questions, you can participate in our information session on April 9. To accommodate different time zones, the webinar is offered at two different times. [Register here](https://www.ccfacility.org/news-and-events/application-round-2025-1). 

## ABOUT THE CATALYTIC CLIMATE FINANCE FACILITY
The Catalytic Climate Finance Facility (CC Facility) is a solution to scale climate finance by filling a market gap in mobilizing private capital. The CC Facility provides a suite of acceleration services to market-ready blended finance vehicles in developing economies to help them reach scale. Through grant funding, technical support, and a learning hub, the CC Facility accelerates the implementation of high-impact financial structures, while providing resources to the broader ecosystem on how to best catalyze climate finance. The initiative is a partnership between Climate Policy Initiative (CPI) and Convergence.

## MEDIA CONTACTS
__Sijia Yi__ 
Head of Communications 
Convergence Blended Finance 
sijia.yi@convergence.finance 
 
__Júlio Lubianco__ 
Communications Manager 
Climate Policy Initiative 
julio.lubianco@cpiglobal.org

CC Facility launches new call for applications targeting sustainable agriculture and climate adaptation

CC Facility launches new call for applications

Recent years have demonstrated an increase in blended finance transactions, not only in the number of overall transactions launched but also in the scope of stakeholders involved. We see a similar upward trend in gender-related blended finance deals.

For example, according to our database, 412 out of 1346 (31%) blended finance deals have gender as one of their targeted Sustainable Development Goals (SDGs), representing a total commitment of __$49 billion__ out of the $248 billion market. On average, each investment in this space is sized at $15 million, with a total of 944 different investors.

__The Growth of Gender Deals: Trends and Patterns__
![genderdeals](//images.ctfassets.net/4cgqlwde6qy0/6M6kGIjKO7aebfVAMM9MYP/f88b6b2b787171bf1d99f1b89b7ae1d8/genderdeals.png)
While the number of gender-focused transactions surged significantly between 2021 and 2023, the total annual capital committed has remained relatively flat. This suggests a shift in the gender-related investment landscape, where more investors are injecting capital, but the size of their investments is relatively smaller. Private sector actors, particularly commercial and impact investors, increasingly engage in gender-related investments. For example, they invested around $12 billion out of the total of $49 billion in gender-related blended finance transactions. Over the past three years, more than 167 unique private-sector investors participated in 163 gender-related deals.

__Leading Investors: The Public Sector’s Persistent Influence__
![genderinvestors](//images.ctfassets.net/4cgqlwde6qy0/3tGibQPZj9wqZTDC9u7pMa/683685a97e3ae6a3f1a9617226c3853a/genderinvestors.png)
However, despite the rising involvement of the private sector, multilateral development banks (MDBs) and development finance institutions (DFIs) still top the league tables for gender-related blended finance deals by number of transactions. Key players who have invested in more than 50 gender-focused blended finance deals are Dutch FMO, the International Finance Corporation, and the US public agencies: the United States Agency for International Development and the United States International Development Finance Corporation.

FMO is among the most active development banks in the gender-related blended finance space. For example, the [Insitor Impact Asia Fund II](https://www.fmo.nl/project-detail/62056) (IIAF II) is a venture capital fund that invests in early-stage businesses to enhance accessibility to essential goods and services for low-income populations in Cambodia, India, and Pakistan. With a strong commitment to gender inclusion, IIAF II has qualified as a 2X Flagship Fund. It reached an interim close of $42 million in 2022, backed by key investors, including our member, British International Investment, which provided $15 million as anchor investment, and $10 million of concessional capital by FMO.

__Commercial Investors Role__

Commercial investors are increasingly participating in gender-related blended finance deals, albeit at smaller amounts and at a slower pace. For example, [BancoSol](https://www.bancosol.com.bo/) issued Bolivia’s first gender bond to empower women-led Micro, Small and Medium Enterprises (MSMEs) in 2024. The local currency gender bond raised $30 million to expand credit for 4,500 women-led MSMEs, especially in rural and Amazonian regions. Our member, IDB Invest supported the issuance with a 50% partial credit guarantee, while We-Fi, provided a $200,000 performance-based incentive linked to BancoSol’s women-led SME portfolio growth.

Another promising trend we’ve been witnessing in the last few years is the intersection of gender and climate finance. For example, at the last G7 Summit in Italy, members of 2X Global and other financial institutions pledged $20 billion toward gender-lens investing in developing countries, with a particular emphasis on projects addressing both gender and climate challenges.

While MDBs and DFIs have long been the backbone of gender-focused blended finance, the reality of diminishing official development aid underscores the need for a more diversified approach. We can no longer rely on a single actor—every stakeholder has a vital role to play. Moving forward, collaboration across the public, private, and philanthropic sectors will be essential to scaling impact and ensuring that capital reaches those who need it most. The increasing involvement of private sector actors signals a shift toward greater market participation, but there is still considerable potential for growth, particularly in aligning commercial investments with targeted gender-lens strategies.

*Please view our [gender equality page](https://www.convergence.finance/about/themes) for more gender-related blended finance resources, including stats on gender deals, grant programs, trainings, publications, and more.*

Recent years have demonstrated an increase in blended finance transactions, not only in the number of overall transactions launched but also in the scope of stakeholders involved. We see a similar upward trend in gender-related blended finance deals.

Top Investors in Gender-Focused Blended Finance Deals

Who Are the Top Investors in Gender-Focused Blended Finance Deals?

According to the [*2025 Macroeconomic Performance and Outlook Report*](https://www.afdb.org/en/documents/publications/africas-macro-economic-performance-and-outlook-report) released by the African Development Bank (AFDB), East Africa is projected to be the fastest-growing region in Africa, with GDP growth expected to rise from 4.4% in 2024 to 5.3% in 2025 and further increase to 6.1% by 2026. However, the underserved investment market in East Africa is immense. In response, new business models are emerging to address the barriers to financial inclusion in the form of mobile banking, digital lending, and other fintech innovations. Achieving success in reaching the underserved with appropriate services tailored to their needs includes focusing on enterprising individuals plus small and growing businesses.

## adOpes Microleasing Fund
In 2023, the SDG Impact Finance Initiative, with the support of Convergence, awarded a $200,000 expansion grant to adOpes under the Innovation Window. The Design Funding was specifically used to support expansion of the adOpes Microleasing Fund, which provides 9 to 18-month lease-to-own contracts to facilitate the acquisition of productive use assets by smallholder farmers. The Fund was launched in May 2023 and has deployed capital in Kenya, Tanzania, and Uganda, providing financing to Savings and Credit Cooperatives (SACCOs) and Microfinance institutions (MFIs) for microleasing to smallholder farmers, who would otherwise remain excluded from asset finance. In addition, the fund offers capacity-building and technical assistance, with the support of local technical partners  to the investees and farmers.

## Impact To-Date
As of December 2024, the adOpes Microleasing Fund's investments in partner SACCOs and MFIs have provided financing for lease-to-own contracts for __16,424 productive assets__ (microleases) for farmers in the region, with __68% of the total assets leased by women farmers__. These microleases are expected to increase the income of smallholder farmers by approximately __$4.8 million over the next three years__. Additionally, the Fund's investments have had an indirect mobilization or crowding in effect, with __SACCO and MFI partners leveraging about 50% of additional capital__ to help to co-finance these leases. The activity through the Microleasing Fund also led to the __creation of 57 formal jobs__ at the SACCO and MFI levels. 

Since May 2023, farmers have acquired a diverse range of assets, including farm tools, small transport, land leases, and climate-smart equipment such as solar and biogas-powered assets. By acquiring __climate-smart assets__, smallholder farmers are also contributing to SDG 13 (Climate Action) through the reduction of CO2 emissions as well as SDG 7 (Affordable and Clean Energy), by promoting the use of energy-efficient and environmentally friendly technologies. As of December 2024, the Microleasing Fund has financed __444 climate smart assets__, resulting in an estimated __775 tCO2 emission reductions__.

Through these initiatives, farmers like [Vicky Cherono](https://adopes.com/news/celebrating-vicky-cherono-empowering-women-in-agriculture/) and [Margaret Wanja](https://adopes.com/news/our-shujaa-the-inspiring-success-story-of-margaret-wanja/) have been able to transform their farms and homes, significantly changing their lives. Microleases are structured to transfer ownership to the farmers upon payment of the assets. This enables women and youth to overcome the collateral barrier of traditional lending.
![adOpes Microleasing Fund](//images.ctfassets.net/4cgqlwde6qy0/2FTlih0dIkSf2IzMY1Rr1q/48117a9ee2d51c3602b25d2092cfef6a/adOpes2.jpg)

## adOpes’ unique approach 
Within just 18 months of operations, adOpes has successfully achieved two key milestones; __non-performing loans of only 1% and successful recycling of capital__ through repaid principal and interest. Several factors contribute to the Microleasing Fund experiencing comparatively low losses. First, the Fund exclusively finances microleases for assets that can be sold in secondary markets in case of defaults. The ability to retain the asset while making payments and benefiting from its use provides a strong incentive for farmers to stay on track with payments. Second, the demand for asset finance tailored to the needs of farmers in East Africa exceeds the available capital. Thousands of SACCOs and MFIs across Kenya, Rwanda, Tanzania, and Uganda are looking to fund assets for their farmers, allowing for a rigorous screening and accreditation process to ensure requisite experience, vintage, balance sheet size, and current portfolio performance. Currently, the Fund’s indicative pipeline stands at 96 SACCOs/MFIs seeking to fund $48 million in assets for farmers. Additionally, having an external investment committee with extensive regional and sectoral knowledge and experience and a rigorous risk management framework ensures good governance. Finally, the microleasing portfolio is diversified by asset classes, countries, and currencies, mitigating geographical concentration risk.

## How to enhance and sustain impact in the microleasing and agrifinance sector?
From a market systems development perspective, adOpes’ investment approach extends beyond directly benefiting agriculture and agriculture finance supply chains. It also engages and catalyzes enterprises in supporting functions of the agriculture market system, including asset/equipment suppliers, micro-insurance providers, training providers, and input suppliers. By addressing a key constraint in agrifinance, a single investment can lead to growth in economic activity, job creation, and higher incomes, delivering significantly higher value for money compared to direct investments in each function separately.

SACCOs and MFIs, along with digital solutions and banking agents, have built a strong network in rural areas that link the financial sector with farmers. However, their services are often limited to deposits, savings, and small loans rather than productive loans to facilitate growth in the sector. Many SACCOs and MFIs remain unable to meet the capital needs of the vast numbers of farmers. Therefore, investments to scale high-performing SACCOs and MFIs are a critical component to driving growth and an untapped opportunity for the financial services market from both commercial and impact perspectives.

Additionally, capacity building plays a crucial role in empowering farmers. Financial literacy, entrepreneurship training, and agricultural best practices help both farmers and SACCOs and MFIs unlock their full potential while further de-risking the Fund’s portfolio. Availing capital for productive agricultural assets will also accelerate the distribution and uptake of climate-smart and green technology in the region.

## Key positive trends in the microleasing and agrifinance space
Agriculture is more vital than ever before. The global population is [expected to reach 10 billion by 2050](https://www.wri.org/insights/how-sustainably-feed-10-billion-people-2050-21-charts), leading to higher food consumption. Currently,[ family farms produce 80% of the world’s food supply](https://www.fao.org/newsroom/detail/Small-family-farmers-produce-a-third-of-the-world-s-food/en). Agriculture continues to be a crucial sector for Africa's socio-economic development. Smallholder farming alone supports over 60% of the continent's population and contributes around 23% to Africa's GDP. Access to inputs, financing, and availability of water are [essential for agricultural productivity and ensuring food security](https://www.nepad.org/blog/improving-food-security-africa-through-water-harvesting-technologies). These factors present both significant challenges and opportunities for the agricultural sector.

adOpes has observed a significant increase in awareness of agriculture’s importance, particularly the role of farmers in primary crop and livestock production  in East Africa. Farmers not only supply food for consumption but also provide inputs for value-added agriSMEs across the region.

Agriculture is increasingly important in providing livelihoods and income generation, especially for women and the growing youth population. Over the past three to five years, the agriculture sector has gained more recognition, leading to increased capital investment in agriSMEs. However, investing in primary agri-value chain production at the smallholder farmer level and their related activities remains a challenge. Farmers face multiple risks, including reliance on rain-fed agriculture, climate change impacts, and fluctuating input and selling prices for their produce.

As investors seek solutions to address these challenges, agrifinance players have a growing opportunity to innovate and provide tailored financial products for rural farmers.

## How Design Funding advanced the solution, and what’s next for adOpes?  
The Design Funding award helped to further propel adOpes and its Microleasing Fund by increasing visibility and attracting increased investor interest. In addition, the upfront rigorous and competitive application process allowed adOpes to further consider, refine, and align its offerings. The award supporting key design and expansion activities, combined with adOpes’ demonstrated impact so far, has further strengthened confidence in its forward-leaning and inclusive financing model. The grant has also supported deal structuring efforts in Kenya, Tanzania, and Uganda, further advancing the Fund’s mission. 

Looking forward, adOpes and the Microleasing Fund aim to fund the demand pipeline and continue to grow a quality portfolio that will take them into profitability. adOpes also plans to expand and deploy capital in Rwanda later in 2025. Together with partners in the areas of technology, insurance, capacity building, asset companies, agriSME,s and Ministries of Agriculture, adOpes aspires to build a platform that supports farmers in East Africa beyond capital alone.


Impact Story: adOpes - a microleasing platform offering productive assets to smallholder farmers and micro enterprises