responsAbility successfully launches new financial inclusion bond

June 20243 min readFinancial InclusionEmerging Markets, ESG, Impact, Microfinance

Zurich, 3rd of June 2024 – responsAbility, the leading Swiss impact asset manager, in partnership with the U.S. International Development Finance Corporation (DFC), has successfully launched a new financial inclusion bond. This USD 123.5 million bond, arranged by J.P. Morgan, is designed to provide institutional investors with access to impact investments via listed securities thereby achieving positive social and financial impacts at scale in financial inclusion.  The financial inclusion bond specifically targets financial inclusion projects, facilitating access to financial services for individuals and micro, small, and medium enterprises (MSMEs) in developing countries who currently lack access to traditional banking services. These investments promote local jobs, reduce poverty, empower women, and support critical social areas such as education and health. The bond has already allocated capital to about 30 qualified microfinance and SME focused financial institutions, which - due to specialized and differentiated business models – are often not the focus of larger investors.

DFC as a Catalyst for Impact Investments  The U.S. Development Finance Corporation (DFC) supports the financial inclusion bond in the senior tranche, demonstrating the U.S. government's commitment and willingness to support investments in the area of international development to support market innovation and mobilize private capital.   “DFC is proud to be supporting such an innovative and impactful project with responsAbility that aligns with our priority of catalyzing investment to support small businesses.", said Maryam Khosharay, DFC's Acting Vice President of Small Business & Financial Services. “This is highly significant work that will provide vital financing to support small businesses in emerging markets while also promoting economic growth, job creation, and supporting critical social sectors.” 

Continuity and Innovation in Financial Inclusion Projects  This financial inclusion bond continues responsAbility's track record of successful market innovations in the form of listed securities that have mobilized significant resources for financial inclusion as well as for other impact themes. The USD 175 million financial inclusion bond carried out in 2019 financed financial institutions that supported over 30,000 small businesses and provided access to financing for more than 5.6 million microcredit borrowers, with women making up over 80% of the borrowers. Furthermore, a social bond initiated in 2021 provided over USD 177 million to companies operating in the financial inclusion, healthcare, and WASH (Water, Sanitation, and Hygiene) sectors. These initiatives highlight responsAbility's ability to use innovative financial instruments that generate both financial and social returns. 

Future-Oriented Investments with Measurable Impact  "With this financial inclusion bond, we offer a unique opportunity for professional investors to gain direct access to financial inclusion through listed securities, rather than through traditional private market placements", said Thomas Müller, Co-Head of Products & Structuring at responsAbility. "This innovative approach simplifies access and aligns perfectly with our mission to mobilize private capital and invest in emerging markets, aiming to achieve financial returns while generating a positive societal and financial impact." 

About DFC The U.S. International Development Finance Corporation (DFC) is the U.S. Government’s development finance institution. DFC partners with the private sector to finance solutions to the most critical challenges facing the developing world today. DFC invests across sectors including energy, healthcare, infrastructure, agriculture, and small business and financial services. DFC investments adhere to high standards and respect the environment, human rights, and worker rights.  

About responsAbility Investments AG responsAbility Investments AG is a leading impact asset manager specializing in private market investments across three investment themes to directly contribute to the United Nations Sustainable Development Goals (SDGs): Financial Inclusion, to finance the growth of Micro & SMEs; Climate Finance, to contribute to a net zero pathway; and Sustainable Food, to sustainably feed an ever-growing population. All responsAbility investment solutions target specific measurable impact alongside market returns.

Since its inception in 2003, responsAbility has deployed over USD 15.4 billion in impact investments. With over 270 employees collaborating across eight offices, as of 31 December 2023 the company manages USD 4.8 billion in assets across approximately 280 portfolio companies in 69 countries. Since 2022 responsAbility is part of M&G plc, the international savings, and investments business, and contributes to enhancing M&G’s capabilities in impact investing.

Contact

Richard Rogers
responsAbility Investments
+41 44 403 2151
media@responsability.com

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