Zurich/London/Lima, 27 June 2023

  • In partnership with Global Affairs Canada and IDB Invest, BlueOrchard (a member of the Schroders Group) is launching a dedicated impact investing strategy focusing on gender equality, diversity, and inclusion in Latin America and the Caribbean (LAC)
  • The strategy focuses on accelerating the financial inclusion of women, indigenous groups, Afro-descendants, migrants, and other underserved groups in the region through an innovative blended finance approach
  • USD 100 million raised from public investors as well as renowned family offices and pension funds, target size is USD 200 million
  • It is the second dedicated gender-lens investment strategy managed by BlueOrchard, present with regional strategies in LAC since 2007
  • The impact strategy has sustainable investment as its objective within the meaning of Article 9 of the SFDR regulation[1] and addresses the United Nations Sustainable Development Goals (SDGs)

In LAC, 70% of the population is unbanked[1], indigenous households make up 17% of the population living in extreme poverty[2], and Afro-descendants are 2.5 times more likely to be chronically poor than whites[3]. The financing gap for women-led enterprises and women-owned micro businesses in the region is nearly USD 100 billion[4]. There is a continued dependency on public funds to address this challenge, even though public funding alone will not be sufficient.

There is an urgent need to promote financial inclusion for underserved and marginalised groups in Latin America and the Caribbean through tailored solutions and innovative investment strategies. Building on shared objectives, two important public investors for development, Global Affairs Canada and IDB Invest, combined their strengths with BlueOrchard and Schroders to provide financing to increase the economic well-being and resilience of micro, small, and medium-sized enterprises (MSMEs) led or owned by underserved groups in LAC. Using an innovative blended financing approach with investments from both the public and the private sectors, the strategy will help to close funding gaps for MSMEs in LAC. The impact strategy will focus on three key strategic pillars to achieve its goal: (1) developing and improving inclusive solutions offered by financial institutions in the LAC region; (2) promoting gender, diversity, and inclusion practices at the level of financial institutions; and (3) collecting, analysing, and evaluating relevant gender, diversity, and inclusion (GDI) data at the market, institution, and aggregated client levels. In this way, the strategy is expected to contribute not only to better impact measurement, but also to more tailored product development and improvement, as well as GDI practices. In addition to financing, a technical assistance facility will support market building activities and projects.

“We have been committed to inclusion for more than 20 years and have been present in Latin America and the Caribbean for more than 15 years. With this important Gender, Diversity, and Inclusion strategy, thanks to our strong partners, we can take a big step forward towards greater equality and unleash the potential of entrepreneurship for underserved groups,” said BlueOrchard’s CEO, Philipp Mueller.

“As a responsible investment business, we prioritize Sustainable and Impact investing practices at Schroders Capital, with unique opportunities to accelerate positive change and deliver long-term impactful financial performance. Our commitment to sustainability and impact includes supporting the transition to net zero and promoting financial inclusion and sustainable development worldwide through tailored solutions and innovative investment strategies. We believe this strategy can make an important contribution to promoting financial inclusion for underserved and marginalised groups in Latin America and the Caribbean“, said Georg Wunderlin, Head of Private Assets, Schroders Capital.

“The Government of Canada is committed to supporting new partnerships and ways to finance and drive development, particularly for excluded populations. It’s imperative that we mobilise public and private investment — and especially innovative sources of financing — for greater social, economic, and environmental impact. Canadian investments are helping to build new markets for private investment, especially with a gender lens,” said Louis Marcotte, Ambassador of Canada for Peru and Bolivia.

“The impact and profitability of investing with a gender, diversity and inclusion lens is becoming increasingly known, yet there still remains significant financing gaps for women entrepreneurs, indigenous groups, Afro-descendants, migrants, and other underserved groups in Latin America and the Caribbean,” said Gema Sacristan, IDB Invest’s Chief Investment Officer. “At IDB Invest, financial inclusion is a priority for us. Together with banks and other financial intermediaries, we are committed to advancing this objective to support gender equality, diversity, and inclusion, and financial well-being of vulnerable populations.”

BlueOrchard, which is a member of the Schroders Group, is a pioneer in the growing field of impact investing. The firm has a track record of over 20 years, a global reach of 260 million beneficiaries, and manages the largest commercial microfinance fund in the world. A multi-asset class impact fund manager, BlueOrchard combines social and environmental impact with a positive financial return. BlueOrchard has invested in more than 105 emerging and frontier markets through a network of over 720 financial institutions. The firm’s impact and ESG management process is best-in-class and externally verified.

BlueOrchard has been present in LAC since 2007 and was selected in a competitive process after the 2007/2008 financial crisis to manage a microfinance strategy exclusively for LAC. The strategy has financed 400’000 micro-entrepreneurs across 13 countries in LAC. BlueOrchard’s investment team in LAC is located in Lima, Peru, and has an extensive track record in working with financial institutions across the continent.

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[1] FinTech Is Driving Financial Inclusion In Latin America (forbes.com)

[2] The situation of Latin America’s indigenous population and the impact of COVID-19 | United Nations Development Programme (undp.org)

[3] Eliminating Afro-descendant Exclusion in Latin America is Vital for Development (worldbank.org)

[4] Gender Lens Investing: How Finance Can Accelerate Gender Equality in Latin America and the Caribbean. IDB.” (2019)

For further information, please contact:

Tahmina Theis
+41 22 596 47 69
tahmina.theis@blueorchard.com

 

About BlueOrchard Finance Ltd

BlueOrchard is a leading global impact investment manager and member of the Schroders Group. As a pioneering impact investor, the firm is dedicated to generating lasting positive impact for communities and the environment, while aiming at providing attractive returns to investors. BlueOrchard was founded in 2001, by initiative of the UN, as the first commercial manager of microfinance debt investments worldwide. Today, the firm offers impact investment solutions across asset classes, connecting millions of entrepreneurs in emerging and frontier markets with investors with the aim to make impact investment solutions accessible to all and to advance the conscious use of capital. Being a professional investment manager and expert in innovative blended finance mandates, BlueOrchard has a sophisticated international investor base and is a trusted partner of leading global development finance institutions. To date, BlueOrchard has invested over USD 10 billion across more than 105 countries. 260 million underserved people and MSMEs in emerging and frontier markets received access to financial and related services with the support of BlueOrchard as of December 2022. For additional information, please visit: www.blueorchard.com.

Schroders plc

Founded in 1804, Schroders is one of Europe’s largest independent investment management firms by assets under management. As at 31 December 2021, assets under management were £731.6 billion (€871.3 billion; $990.9 billion). The founding family remain a core shareholder, holding approximately 48% of the firm’s voting shares. Schroders has continued to deliver strong financial results. It has a market capitalisation of circa £8 billion and employs over 5,700 people across 37 locations.

Schroders has benefited from the most diverse business model of any UK asset manager by geography, by asset class and by client type. Schroders offers innovative products and solutions across their five business areas of solutions; institutional; mutual funds; private assets & alternatives; and wealth management. Clients include insurance companies, pension schemes, sovereign wealth funds, endowments and foundations. They also manage assets for end clients as part of their relationships with distributors, financial advisers and online platforms. Schroders’ Wealth Management offering reflects their strategic ambition to provide wealth management and financial planning services to clients across the wealth spectrum.

Schroders’ strategic aims are to grow their asset management business, build closer relationships with end clients and expand their private assets and alternatives business. Schroders’ purpose is to provide excellent investment performance to clients through active management. The business channels capital into sustainable and durable businesses to accelerate positive change in the world. Schroders’ business philosophy is based on the belief that if they deliver for clients, they deliver for Shareholders and other stakeholders.

Further information about Schroders can be found at www.schroders.com.

Issued by Schroder Investment Management Limited. Registration No 1893220 England. Authorised and regulated by the Financial Conduct Authority. For regular updates by e-mail please register online at www.schroders.com for our alerting service.

About GAC

Global Affairs Canada (GAC) defines, shapes and advances Canada’s interests and values in a complex global environment. They manage diplomatic relations, promote international trade and provide consular assistance. GAC also leads international development, humanitarian, and peace and security assistance efforts, and contributes to national security and the development of international law. 

About IDB Invest

IDB Invest, a member of the Inter-American Development Bank Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region. With a portfolio of $16.33 billion in assets under management and 394 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.

 

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