The wide-ranging impact of the Covid-19 pandemic threatens decades of progress made towards reducing global poverty and inequality. Though many financial institutions in emerging and frontier markets have weathered the current crisis without major disruption, others need support in order to keep financing micro, small and medium-sized enterprises (MSMEs), which build the backbone of developing countries’ economic growth and employment. To support these MSMEs, BlueOrchard launched the “BlueOrchard Covid-19 Emerging and Frontier Markets MSME Support Fund” in partnership with leading public and private investors at the end of 2020.
For the second closing at USD 207 million, the Fund welcomes IDB Invest, part of the Inter-American Development Bank Group, and Visa Foundation as new investors into the Fund. With the participation of IDB Invest and Visa Foundation, the Fund sharpens its profile as a leading blended finance vehicle, fighting against the economic consequences of the Covid-19 pandemic. Other investors include Schroders, CDC (the UK’s development finance institution), DFC (U.S. International Development Finance Corporation), FSD Africa Investments (the investment arm of FSD Africa, a specialist development agency supported by UK aid), JICA (Japan International Cooperation Agency), KfW (the German development bank) and SECO (Swiss State Secretariat for Economic Affairs), as donor for the Fund’s Technical Assistance Facility.
As of March 2021, the Fund has invested in 14 financial institutions across 13 countries, spanning Africa, Asia, Eastern Europe, and Latin America, and is supporting more than 26 million jobs.
The Fund qualifies under the 2X Challenge criteria — a commitment by the development finance institutions of the G7 to mobilise capital toward investments that support women’s economic empowerment in emerging markets.
Maria Teresa Zappia, Chief Impact and Blended Finance Officer, Deputy CEO, BlueOrchard, said: “At times like these, decisive action and strong cooperation are needed to support those most in need. We are very grateful for, and proud of, the trust placed in us by investors who share our mission and goals.”
James Scriven, CEO, IDB Invest, said: “At IDB Invest, we are pleased to close this transaction with BlueOrchard. Our partnership will increase the availability of private debt financing for MIPYMES in LAC, restoring credit worthiness and increasing the supply of emergency financing for MSMEs that seek to mitigate the severe impacts of Covid-19 on jobs and value chains. Supporting MSMEs and job creation is key to an inclusive recovery for Latin America and the Caribbean.”
Graham Macmillan, President of Visa Foundation, said: “Visa Foundation is proud to support partners that enable equitable access to capital for small and micro businesses as they rebuild from the pandemic. BlueOrchard’s approach, which provides tailored financing to microfinance institutions and small business lenders helps small business, especially women-led ones, build resilience and supports long-term community development.”
Dr. Stefan Breuer, Member of the Management Committee, KfW Development Bank, said: “Providing liquidity to financial institutions in order to maintain MSME-lending plays a key-role in the mitigation of the economic impact of the Covid-19-crisis, both in the short and medium term. The BlueOrchard Covid-19-Support-Fund is an appropriate vehicle for raising private and public capital to fulfill this mission.”
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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 more than USD 8bn across more than 90 countries. Over 215 million poor and vulnerable people in emerging and frontier markets received access to financial and related services with the support of BlueOrchard as of December 2020. For additional information, please visit: www.blueorchard.com.
For further information, please contact:
Tahmina Theis
+41 22 596 47 69
tahmina.theis@blueorchard.com
www.blueorchard.com
Disclaimer:
COVID-19 EMERGING AND FRONTIER MARKETS MSME SUPPORT FUND SCSp SICAV-RAIF is a closed-end fund, unlike open-end funds, shares are not continually offered. An investment in a closed-end fund presents a number of risks and is not suitable for all investors.
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