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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

__Thursday, April 17, 2025 at 2:30PM - 3:30PM CET__

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Join Convergence alongside the World Association of PPP Units & Professionals (WAPPP) for their 'Role of infrastructure funds and institutional investors in blended finance PPPs' webinar on April 17.

Some funders, including institutional investors like pension funds, insurance companies, sovereign wealth funds, hedge funds, and investment funds, operate at a portfolio level. This session explores the fund-based approach to financing projects and PPPs, highlighting scalable models for financing facilities, asset-based funds, and thematic investing. It also examines how these strategies evolve into impactful investments.

More details to come.

WAPPP 2025: Role of infrastructure funds and institutional investors in blended finance PPPs

Join WAPPP for this session that will explore the fund-based approach to financing projects and PPPs, highlighting scalable models for financing facilities, asset-based funds, and thematic investing.

Fund-based approach to financing projects and PPPs

Info Sessions - 2025.1 call for proposals

__April 9, 2025 | 9:00 AM and 9:00 PM (EST)__

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This webinar is an informational session for organizations interested in applying to the Catalytic Climate Finance Facility (CC Facility).

It provides an overview of the application process, eligibility criteria, and guidance on securing funding and acceleration support.

Participants will also learn about the CC Facility’s mission to scale innovative financial solutions in climate finance.

The session includes insights on strengthening applications and maximizing impact, with opportunities for attendees to ask questions.

To accommodate different time zones, the webinar is offered at two different times:
- 9 AM EST – Best for Americas, Europe, Africa, and South Asia.
- 9 PM EST – Ideal for those in Asia-Pacific and Oceania.
 
Attendees should select the session that best fits their schedule.

Webinar: Learn Why and How to Apply to the CC Facility

Join one of our webinars on April 9 to learn about the CC Facility, including eligibility criteria, application process, and available resources. Register today to discover how to increase your likelihood of securing funding and scaling your impact.

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__Tuesday, April 8th, 6:00pm – 8:30pm EAT__

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Convergence, Renew Capital, and East Africa Private Equity and Venture Capital Association (EAVCA) are hosting an invite-only networking reception during the Africa Regional Forum on Sustainable Development in Kampala. 

The event will bring together members and partners of all three organizations alongside other innovative finance stakeholders, including impact investors, institutional investors, donor agencies, development banks, and sponsors of blended finance deals. It will be an opportunity to connect with like-minded individuals/institutions engaged in blended finance, make new contacts, exchange ideas, and more.

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

If you have questions, please email Basil (basil.kandaya@convergence.finance) or Leonard (leonard@eavca.org)

Member Networking Reception in Kampala

Join us for a member networking reception in Kampala, Uganda

Inside the Deal: Development Bank of Rwanda’s Sustainability Linked Bond

__Inside the Deal: Development Bank of Rwanda’s Sustainability Linked Bond, March 27, 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 the Development Bank of Rwanda (BRD)’s groundbreaking Sustainability Linked Bond (SLB)—the first-ever SLB issued by a development bank globally. This innovative bond features a credit enhancement mechanism and is tied to key sustainability indicators.

During this hour-long webinar, BRD will walk us through the bond’s structure 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 the Development Bank of Rwanda’s Sustainability Linked Bond.

Inside the Deal: BRD's Sustainability Linked Bond

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__Member Training: How Impact Investors Blend with a Gender-Lens, March 25th, 2025 at 10:00AM – 11:00AM ET (7AM PDT)__

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This webinar will be co-hosted by Convergence and the Global Impact Investing Network (GIIN). Designed exclusively for both Convergence and GIIN members, and aims to educate in an interactive format to enable cross-learnings and create meaningful connections. 

As the need for data transparency on blended transactions becomes more pronounced, there is more attention being paid to the perceived risk versus real risk in emerging markets. As we witness growing geopolitical and economic shifts, some impact-focused investors are making the case for global diversification to help mitigate and manage risk whilst also supporting sustainable development in emerging, high-growth markets. A key component of this strategy is a also an emphasis on deploying capital strategically with a gender-lens. 

In this session, we will look at the data behind these blended investments, showcase successful models and invite leading impact investors to share their insights and strategies for blended finance structures in emerging markets, with a spotlight on successful gender-lens approaches.


Member Training: How Impact Investors Blend with a Gender-Lens

WAPP 2025: Structuring approaches to make blended finance PPP projects investable

__Thursday, March 20, 2025 at 2:30PM - 3:30PM CET__

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Following the successful launch of World Association of PPP Units & Professionals (WAPPP)'s 2025 program on Mobilizing Blended Finance for PPPs on February 20, WAPP is hosting a webinar on structuring approaches to make blended finance PPP projects investable.

In the first session, Convergence and WAPP explored how blended finance enhances the viability of PPP projects, bridges infrastructure gaps, and supports sustainable development.

This session will take a deeper dive into structuring blended finance to attract private capital at scale. We’ll examine:

- What does project-level investability mean?
- How do capital providers view their entry points and integration?
- Key structuring terms and conditions—demystified
- Case studies showcasing successful blended finance PPPs

This multi-stakeholder panel will provide practical insights on how different PPP projects can leverage blended finance effectively.

WAPPP 2025: Structuring approaches to make blended finance PPP projects investable

Join WAPPP for this session that will take a deeper dive into structuring blended finance to attract private capital at scale.

Structuring approach to make blended finance PPP investable

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__Friday, February 28, 2025, 9:00AM - 5:00PM EAT, Nairobi, Kenya__

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Join Nairobi's public, private, and philanthropic actors for an in-person interactive and practice-driven training on blended finance. This intermediate-level session will combine insights from Convergence experts and blended finance practitioners in the field. This training is an opportunity for Convergence members and partners to gather to share insights and experiences and tackle difficult questions around innovative approaches to mobilize private capital for the Sustainable Development Goals.

Speaker details and agenda to follow.

This training is complimentary for members (one seat for Standard Membership, two seats for Market Builder Membership), USD 150 for additional member seats, and USD 250 for non-members. Please contact your relationship manager for more details or questions about your membership type.

*Registration is on a first come, first served basis and capacity is limited. We encourage registering early to reserve your seat.*

In-Person Convergence Blended Finance Training in Nairobi

Join us in Nairobi, Kenya for a full-day training combining insights from Convergence experts and blended finance practitioners in the field.

Blended Finance Training in Nairobi, Kenya

sankalpnetworking web

__Thursday, February 27th, 6:00pm – 8:30pm EAT__

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CrossBoundary and Convergence are hosting an invite-only networking reception during the Sankalp Africa Summit. 

The event will bring together Convergence's members, partners, and other innovative finance stakeholders comprising of impact investors, institutional investors, donor agencies, development banks, and sponsors of blended finance deals. Attendees will have the opportunity 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 Nairobi

Join us for a member networking reception in Nairobi, Kenya

Launch event banner -2025Theme Mobilizing Blended Finance for PPPs

__Thursday, February 20, 2025 at 2:30PM CET__

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Join Convergence alongside the World Association of PPP Units & Professionals (WAPPP) as they launch their 2025 theme: “Mobilizing Blended Finance for PPPs.” The webinar will start with a technical approach, in partnership with Convergence Blended Finance, delving into the fundamentals of blended finance and its strategic role in delivering Public-Private Partnerships (PPPs). The session will explore how blended finance, which involves the strategic deployment of concessional capital alongside commercial investment, enhances the financial viability of projects focused on public infrastructure and services. The goal is to promote the adoption and understanding of blended finance as a key approach for achieving successful PPPs, particularly in developing countries where these projects are often underserved.

Following the technical presentation, representatives from the United Nations Economic Commission for Africa (UNECA), the European Bank for Reconstruction and Development (EBRD), and the African Development Bank (AfDB) will offer insightful comments on the use of blended finance in PPPs. This webinar will serve as a platform for knowledge exchange, showcasing case studies and global experiences in leveraging blended finance for PPPs. Attendees will gain valuable insights into building capacity, structuring blended finance projects, and fostering collaborations among stakeholders to create more environmentally and socially responsible projects. This is a unique opportunity to deepen understanding and expand the use of blended finance as an essential tool in mobilizing private investment for sustainable development.

WAPPP 2025 Theme Launch: Mobilizing Blended Finance for PPPs

Join Convergence alongside the World Association of PPP Units & Professionals (WAPPP) as they launch their 2025 theme: “Mobilizing Blended Finance for PPPs.”

Africa's Green Economy Summit

Deal Connect

Join us for an informative webinar that will connect you to relevant blended finance investment opportunities in emerging markets. During this interactive session, Convergence members will share details about their investment opportunities that are listed on our live deals database. This is a great opportunity to explore new and unique transactions and learn from developments in the broader blended finance ecosystem. 

Whether you're a seasoned investor or just starting, this webinar is tailored to everyone interested in discovering promising new ventures in emerging markets.

Save the date: __February 19, 2024, from 9:00 -9:45 AM ET__. During the session, we will present two compelling deals from our live deals database:

__Total Impact Notes__ will provide debt capital to several high-impact funds addressing the Sustainable Development Goals (SDGs) in the developing world. The cash flow from this pool of loans will fund debt service payments to the investors in the Notes, offering them a diversified, impact-first product with a fixed coupon payment and medium-term liquidity.

__Organic Development Finance (ODF)__ provides working capital financing to organic agricultural SME's in emerging countries to increase organic production and achieve sustainable impact for environment and people. ODF works closely with Buyer Partners (international traders) to support their suppliers with flexible working capital financing and expertise.

*This webinar series is exclusive to investors registered on the Convergence platform.*

Deal Connect: February 2025

Join us for an informative webinar that will connect you to relevant blended finance investment opportunities in emerging markets.

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__February 19-21, 2025, Cape Town, South Africa__

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Don’t miss [Africa's Green Economy Summit](https://wearevuka.com/green-economy/ages/) in Cape Town from February 19-21, 2025, where global capital meets African opportunities. This investor-focused event will spotlight key themes including green reforms, nature and biodiversity, climate finance, resilient cities, and green industrialization. 

Convergence is a supporting partner of the Summit.

Don’t miss Africa's Green Economy Summit in Cape Town!

__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

adOpes - a microleasing platform

Learn how blended finance fits into AECF's approach, how they measure and track impact, the evolution of their business model, and more.

AECF Member Spotlight

Africa Enterprise Challenge Fund Member Spotlight with Victoria Sabula

Convergence and the East Africa Venture Capital Association (EAVCA) have signed a memorandum of understanding (MoU) to collaborate on growing and developing the understanding, adoption, and application of blended finance in Africa.

Under this MoU, Convergence and EAVCA will collaborate through a strategic framework to expand blended finance knowledge and support the mobilization of private capital in the region. The organizations will participate in reciprocal speaking opportunities, cooperate on joint training programs, and collaborate on other related activities, such as conferences, roundtables, workshops, and more.

“Sustainable investment in East Africa demands innovative financial instruments tailored to local market dynamics to unlock the region’s full economic potential. Blended finance plays a critical role in mobilizing private capital while ensuring the efficient use of public resources,” said Jacklyne Iminza, COO of EAVCA. “Our partnership with Convergence marks a key milestone in strengthening industry capacity, raising awareness, and accelerating the adoption of blended finance to support business growth in the region.” 

“EAVCA’s mandate closely aligns with Convergence’s vision for the growth of blended finance in Africa,” says Aakif Merchant, Director at Convergence. “This partnership will deepen regional blended finance knowledge, while furthering opportunities for our members and partners across the continent.”

__About East Africa Venture Capital Association (EAVCA)__ 
[EAVCA](https://www.eavca.org/), is a business membership organization representing private capital investors across East Africa. Formed in 2013, EAVCA is dedicated to fostering collaboration between capital providers and businesses in the region. The association plays a key role in strengthening the private capital investment ecosystem by advocating for enabling policies, facilitating industry insights and networks, and promoting best practices that drive sustainable economic growth in East Africa. EAVCA membership includes development finance institutions, private equity and venture capital funds, impact investors, family offices, and intermediary advisory firms. EAVCA has offices in Kenya and Uganda.

__About Convergence__ 
[Convergence](http://www.convergence.finance/) 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. We offer this community exclusive access to original market intelligence and knowledge products (such as case studies, data analyses, and online and in-person training), networking events, and more. To accelerate advances in the field, Convergence also provides grants for the design of vehicles that could attract private capital to global development at scale.

Convergence and the East Africa Venture Capital Association have signed a MoU to collaborate on growing and developing the understanding, adoption, and application of blended finance in Africa.

Convergence and EAVCA announce partnership

Convergence and East Africa Venture Capital Association announce partnership to develop blended finance in Africa

At Convergence, we keep our finger on the pulse of new blended finance research and literature, so we can consider them in our analysis and add them to our [Resource Library](https://www.convergence.finance/resource). Over the past year, we have seen many new reports on gender and blended finance come out. Here are three main takeaways:

__1. Industry standards for gender-related impact measurement are becoming more sophisticated.__

Measuring and monitoring the impact of investments on gender quality and women’s economic empowerment can be challenging. 2024 saw important developments in this space. One highlight was the release of the updated [2X Criteria Reference Guide](https://www.2xchallenge.org/2x-criteria-reference-guide). The guide helps investors apply the 2X Criteria, which allow actors to screen and mark deals as 2X-aligned for their internal reporting and tracking purposes. The 2X Criteria are applicable to any kind of investor or financial institution, from impact investors to asset managers, private equity firms, and development finance institutions. As a result, we have seen an increase in the number of blended finance vehicles that apply the 2X Criteria over the past year.

Another highlight was the launch of [2X Certification](https://www.2xcertification.org/) in September 2024. 2X Certification is an independent, third-party verification process that helps advance gender equity for investors, companies and financial instruments. The certification platform is powered by Equilo, a web-based App.

__2. The spotlight turns to investment decision making processes and gender composition of leadership teams.__

In the past, many gender related blended funds and facilities focused their attention on collecting and reporting gender disaggregated data on their investee companies, such as the percentage of women among beneficiaries, or the percentage of women-owned/women-led enterprises. Nowadays, “counting heads” at beneficiary level is no longer sufficient to brand your blended finance vehicle as gender responsive. As part of the selection and due diligence processes, it is an increasingly common practice to review the gender composition of the investment teams and senior management, and gauge how inclusive the decision making processes of these teams really are.

In June 2024, Convergence member IPE Global released a “[Toolkit for Gender Lens Investing](https://samridhhealth.org/toolkit/)”. Based on the experience of the USAID-supported SAMRIDH Blended Finance Facility, this publication provides tailored gender responsive approaches to investments in healthcare. For example, SAMRIDH’s investment committee has equal representation of men and women, all of whom undergo gender sensitization training to ensure an unbiased selection process. The toolkit identifies several teams (at fund level) whose gender composition matters:
![Gender Composition at the Fund level SAMRIDH](//images.ctfassets.net/4cgqlwde6qy0/2oc6KvE41K0aDxhaKS21AX/f3ba82f46f922c5d8f941ba8e9ed5cbb/Gender_Composition_at_the_Fund_level_SAMRIDH.png)
*Image: Gender Composition at the Fund level (Credit: SAMRIDH)*

__3. Moving from short-term to long-term gender outcomes.__

The prevailing three to five year funding cycles of donor-supported projects and blended funds can make it difficult to measure changes over a longer period of time. It inadvertently means interventions are designed with a focus on short-term outputs, such as the number of jobs created for women. Yet, if the goal is lasting change and improving the livelihoods of women across the world, we need to shift towards aiming for and evaluating long-term changes in social dynamics and values. The [first stocktaking report](https://www.ccfacility.org/learning-hub) on Blended Finance and the Gender-Energy Nexus, published by the Catalytic Climate Finance Facility’s Learning Hub, summarized this as follows: “…robust evidence on long-term outcomes of gender lens investing is critical in creating an industry transformation and a paradigm shift in investment practices.”

__For more of the latest research on blended finance, visit our [Resource Library](https://www.convergence.finance/resource).__

*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.*

Over the past year, we have seen many new reports on gender and blended finance come out. Learn about three key takeaways.

3 takeaways from recent reports on gender & blended finance

Three takeaways from recent reports on gender and blended finance

*__Written in collaboration with [Thomas An](https://www.linkedin.com/in/thomasseungan/?originalSubdomain=ca), Associate, Market Acceleration & Design Funding (former).__*

Since its inception eight years ago, Convergence’s Design Funding program has granted over $22 million in design-stage funding to 72 blended finance solutions, fostering the development and implementation of early-stage initiatives that attract private capital towards emerging markets and the Sustainable Development Goals. To date, 28 of these supported solutions have collectively mobilized $2 billion in follow-on capital from a diverse array of public, philanthropic, and private investors. The $2 billion also includes capital mobilized through joint-run programs, such as the SDG Impact Finance Initiative, and the Catalytic Climate Finance Facility in collaboration with the Climate Policy Initiative.

This blog delves into how these solutions have successfully attracted substantial capital, breaking down the types of investors involved and the specific financial vehicles utilized. We also spotlight three projects—Mirova’s Gigaton Empowerment Fund, BlackRock’s Climate Finance Partnership, and The Nature Conservancy’s Blue Bonds—which together account for nearly 70% of the total capital mobilized. By examining these case studies, we aim to provide insights into what makes certain blended finance models effective and scalable, as well as highlight lessons learned from smaller-scale projects like Africa GreenCo, which showcase innovative approaches in high-impact sectors.

## Over half of capital mobilized in the form of private, commercial capital 

![Breakdown of the Design Funding Program’s $2B Capital mobilization figure based on investor and capital type ](//images.ctfassets.net/4cgqlwde6qy0/4R5R0sOd0Ol0PYMjik3iUC/021127f497fb332663f0ebbc5255141b/P1.png)
*Figure 1: Breakdown of the Design Funding Program’s $2B Capital mobilization figure based on investor and capital type*

Most notably, approximately 78% of the total capital mobilized originates from capital providers seeking market-rate financial returns, including $1.19 billion from exclusively private commercial investments. This commitment underscores the effectiveness of these blended finance solutions in instilling confidence and attracting substantial interest from commercially oriented investors.

Contributing further to this mobilization, nearly 14% of the total capital was sourced as concessional funding with below-market rate return expectations from development agencies and similar entities. These development agencies play a pivotal role by offering more favorable terms that lower investment risk, thereby encouraging private investor participation in high-impact projects that might otherwise be overlooked. 

The remaining portion of the total capital mobilized comprises philanthropic and non-return seeking concessional capital, with $157 million allocated in grants. While we see grants more commonly used at the investment stage in transactions in the broader blended finance market, most grants secured by vehicles within our portfolio have been directed toward either earlier-stage design and scale-up activities or technical assistance, providing critical support for vehicle structuring and implementation. 

These funding structures have a strong demonstration effect, showcasing how blended finance can effectively mobilize private capital.

## Fund and bond vehicle types mobilized almost all of the capital 

![Fund and bond vehicle types mobilized almost all of the capital ](//images.ctfassets.net/4cgqlwde6qy0/3sOnY0MmbsU69A8ynLV7dU/b53b909b87c793902c7c4677dd4ea8f2/P2.png)
*Figure 2: Proportion of capital mobilized disaggregated by vehicle type*

As illustrated in Figure 2, the Design Funding portfolio demonstrates a significant concentration of capital mobilization in fund and bond vehicles. Fund-type vehicles have attracted $1.29 billion, accounting for 64% of the total $2 billion mobilized, while bond and note-type vehicles have garnered $550 million, representing 27%. These figures are consistent with prevailing trends in the broader blended finance market as documented by Convergence.

Investors’ familiarity with fund structures plays a crucial role in enhancing their participation in these transactions. Funds facilitate the aggregation of diverse projects or companies, making them an efficient vehicle for investing in diversified portfolios. Bonds and notes in our portfolio, on the other hand, have been primarily utilized for sector-specific solutions such as the blue or green economy. The issuers rely on external certifications to verify targeted impacts and adherence to established standards, thereby attracting investors interested in specific developmental objectives.

Outliers in this landscape include facilities, companies, and impact bonds—nuanced and needs-based blended finance structures that have yet to replicate at scale. At Convergence, we remain eager to support applications proposing unique and innovative financial vehicles across these structure types, recognizing their potential to drive impactful solutions in the future.

## Taking Bets Leads to Whale deals and Scaled Development 

Of the Convergence grant portfolio’s $2 billion of capital mobilized, three solutions represent nearly 70% of the mobilization figure, collectively raising $1.3 billion. The three whale solutions include the Mirova Gigaton Fund, Blackrock’s Climate Finance Partnership (CFP), and The Nature Conservancy’s Blue Bonds for Ocean Conservation. 

Mirova’s [Gigaton Empowerment Fund](https://www.convergence.finance/design-funding/grant-portfolio/1VFqZA6pJa6CXtYRESEvZa/view) has mobilized $331.5 million in capital. The fund is designed with an intentional gender lens, integrating gender-focused investment strategies and business practices. The Fund also is positioned to become the largest-scale initiative addressing the electricity gap. Convergence’s design-stage grant supported the fund in improving its gender strategies to meet the 2X Certification criteria, pursue a credit rating and attract private investors. The fund has already begun making strides in the clean energy sector in emerging markets, investing in [three energy projects thus far across the Africa Region](https://impact-investor.com/mirova-gigaton-fund-grows-to-282m-with-eib-backing/). A contributing factor to the success and scale of the fund is Mirova's experience with managing other blended finance funds. Mirova draws upon its previous experiences and learnings for the Gigaton Empowerment Fund to demonstrate to investors the financial soundness and viability of the fund. 

[Climate Finance Partnership](https://www.convergence.finance/design-funding/grant-portfolio/I5y8rA7djo7Ic6w6n4fp7/view) (CFP), a private equity fund managed by BlackRock, represents one of the largest blended finance transactions to date, aiming to reach a financial close of $1 billion, and marking an unprecedented amount of capital mobilized towards achieving the SDGs. Its [structure, size, catalytic contributions and investment strategy](https://www.convergence.finance/news/3s7v2XsCRrzfeHTxqf7Lzn/view) position it as a scalable and replicable climate-focused transaction in emerging markets. The Fund has invested in five projects in the wind and solar industries, most notably contributing to accessibility and affordability of energy in [Kenya](https://www.power-technology.com/news/climate-finance-kenya/), and supporting [Brazil’s](https://irei.com/news/brasol-announces-investment-from-blackrocks-climate-finance-partnership/) national transition to low-carbon energy. A unique aspect of the CFP is its substantial catalytic tranche, which has received over $100 million in concessional contributions. The private equity fund aims to generate the highest industry-wide concessional to private mobilization ratio by prioritizing investments in middle-income markets. 

[The Belize Blue Bond](https://www.convergence.finance/news/53nMkbseHrNo8CBK9Um1U1/view) for Ocean Conservation has mobilized $400.8 million of capital to date since its launch in 2021. The solution gained Convergence’s support in its early design and structuring stages because of its innovative structure, which supports economic development by refinancing sovereign debt to strengthen national marine conservation efforts. The Belize Blue Bond has made serious waves, [reducing national debt by 12%](https://www.caribois.org/2024/06/can-carbon-credits-be-the-solution-to-belizes-debt/#:~:text=A%20Blue%20Economy%20Sparked%20%E2%80%9CBlue%20Bonds%E2%80%9D&text=It%20represents%20the%20single%20most,cent%20of%20the%20country's%20oceans.). The initial Blue Bond launched in the Seychelles was successful, and served as a model for subsequent blue bonds in other SIDS, including the Belize Bond, and then, the Barbados Bond launched in 2022, and Ecuador Debt-for-Nature Swap in 2023. The structuring of all these transactions leveraged blended finance to demonstrate the bonds structure viability and replicability, and reduce the need for concessional capital in future Blue Bonds. 

While these three whale deals showcase effective ways to increase commercial contributions towards the SDGs, relatively smaller scale solutions in the design funding portfolio have innovative models that not only generate significant impacts, but can also have strong demonstration effects for other blended finance practitioners. 

One example is Africa Greenco (AGC), which has mobilized approximately $23 million in debt, equity and grant commitments, and $122.5 million in guarantee commitments since Convergence’s contributions. Africa faces a persistent and widespread issue of unreliable and insufficient energy access with nearly [600 million individuals](https://csis-website-prod.s3.amazonaws.com/s3fs-public/2024-01/240131_Baskaran_Energy_Africa.pdf?VersionId=5H6XEl6W.3YisdwUoqotAo7aFeXIHLU3) lacking access to electricity in 2022. Despite being a continent rich in energy resources, Sub-Saharan Africa accounts for over [75%](https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2022/Jan/IRENA_Market_Africa_2022.pdf?rev=bb73e285a0974bc996a1f942635ca556) of the global population living without electricity. AGC emerged as an innovative solution to this pervasive problem, functioning as an [intermediary off-taker and service provider](https://africagreenco.com/about-us/) of renewable energy across the Southern Africa Power Pool, and mitigating the risk of power purchasers defaulting to unreliable independent renewable energy companies. This helps strengthen the region’s renewable energy sector, boosts investment in clean energy projects, and enhances the reliability and affordability of energy across Africa. Africa GreenCo has signed three power purchase agreements as of 2023: the [25 MW Ilute Solar PV](https://africagreenco.com/pdf/20231202__PPA_Press_Release%20Ilute%20PPA%20Signing.pdf) Project in Western Zambia, an [85 MW solar project with AMEA Power](https://www.ameapower.com/amea-power-expands-its-presence-in-south-africa-with-85mw-power-purchase-agreement-with-greenco/) in South Africa, and most recently, the [30MW Sable Solar Project in Zimbabwe](https://www.greenbuildingafrica.co.za/jcm-power-signs-ppa-for-30mw-sable-solar-project-in-zimbabwe/). These agreements are facilitating the development of 140 MW of clean energy capacity. Despite the company’s smaller mobilization size, it has provided valuable learnings to the renewable energy market in Africa, as well as delivering substantial impacts to residents and businesses across the region. Since its inception in 2015, there has been a rise in similar renewable off-taker models across the African region. AGC has continued to build on its success, recently signing a [facilities agreement](https://africagreenco.com/regional-collaboration-and-innovative-financing-addresses-zambias-energy-crisis/) with Stanbic Bank and Standard Bank to prepay for 130 MW of electricity imports into Zambia. 

## Conclusion 

“The Design Funding approach offers significant leverage for donors, philanthropists, and impact investors to accelerate the race to address key global development objectives,” says Leah Pedersen, Convergence Senior Director. “The impressive track record of Convergence’s Design Funding initiative underscores the effectiveness of accelerating the launch of new blended finance structures to attract more private sector capital and highlights the catalytic role of grant funding in structuring impactful financing solutions.” By providing design-stage grants, Convergence enhances the viability of early-stage projects and de-risks investments, signaling to private investors that these initiatives are likely sound both financially and in terms of impact. As these projects scale and replicate, they have the potential to contribute significantly to sustainable development in emerging economies. Through design funding, Convergence directly advances its mission to increase private investment in emerging markets and developing economies, supporting the achievement of the SDGs.

Breaking Down the Billions: A Closer Look into Convergence’s Design Funding Program’s $2 Billion Mobilization Figure 

*This op-ed was originally published in [Environmental Finance](https://www.environmental-finance.com/content/analysis/to-support-climate-adaptation-experienced-fund-managers-must-take-the-lead.html).*

The consensus coming out of COP29 is that achieving global climate goals will require increased participation from the private sector. Convergence's recent report on the State of Blended Finance (Climate Edition) found that private sector investment into blended transactions targeting climate goals surged from $1.8 billion in 2022 to $6.2 billion in 2023.

Yet, the bulk of this money flows to climate mitigation rather than adaptation. In the global climate adaptation market, only 1.6% of financing comes from the private sector.

Private investors can be more hesitant to consider investments in blended funds that target adaptation.

Mitigation transactions often have direct revenue streams, such as through the sale of renewable energy, or cost savings from energy efficiency. Conversely, adaptation transactions, which aim to reduce vulnerability to climate impacts and increase resiliency, often do not have an obvious or immediate revenue stream.

Blended finance can be used as a structuring approach to mitigate risk for private sector investors, making it more likely for them to invest in deals aimed at climate adaptation.

Adding a concessional debt or equity tranche in the capital structure, for example, can provide a risk cushion to senior tranche investors. It thereby allows pension funds, insurance companies, or commercial banks to invest in line with their fiduciary responsibilities.

Experienced fund managers play a critical role in structuring such funds. They act as market builders for blended climate adaptation, supplying investors with investment opportunities in line with their (minimum) investment size and their risk-return expectations.

Two examples highlight how fund managers can use blended finance to attract private investment at scale into adaptation.

First, let's look at Climate Investor Two, a blended facility targeting adaptation, specifically water, sanitation, waste, and ocean infrastructure projects in emerging markets.

It is managed by Climate Fund Managers, a Dutch-based joint venture between the Dutch development bank FMO and Sanlam Infraworks. Established in 2019, the fund reached its third close in 2023 with $875 million in commitments, including from institutional investors, such as a Nordic pension fund, a prominent US investment firm, the IMAS Foundation (under the IKEA umbrella), and a commercial bank.

Climate Investor Two is a great example of how a fund manager was able to build on its track record to venture into a more nascent sector. Many investors that took part in Climate Investor Two had already been investors in its predecessor, Climate Investor One, which focused on mitigation (renewable energy infrastructure) in emerging markets.

Climate Investor One was conceptualized in 2015 and reached a final close at $850 million in 2019. By participating in Climate Investor One, commercial investors had already gained an in-depth understanding of the firm's fund architecture and unique full investment cycle approach.

This helped them build strong arguments internally for investing in an adaptation-focused product, despite it being a first for many of them.

Another example is Incofin Investment Management's Water Access Acceleration Fund.

Incofin, a Belgium-based impact fund manager, launched this private equity fund in 2023 to invest in safe drinking water enterprises, primarily in Africa and Asia.

Incofin has a strong track record in using blended finance to catalyze investments in emerging markets: the firm has managed several blended funds focused on the microfinance and agriculture sectors (e.g. Incofin Fairtrade Access Fund).

Now turning to the water sector, the $55 million fund brings together diverse investors such as Danone, BNP Paribas, US International Development Finance Corporation, the Danish development finance institution IFU, Norfund, European Investment Bank, Aqua for All, and the US Agency for International Development.

Here as well, investors trusted the captains that had done it before.

To be sure, first-time fund managers also play an important role in launching adaptation-focused vehicles. In fact, the first adaptation-focused blended fund, the Climate Resilience and Adaptation Finance and Technology-transfer facility, was launched in 2019 by a first-time fund manager (the Lightsmith Group).

However, we need to see more money flowing towards adaptation, urgently. The time to market (from incubation to first financial close) will arguably be shorter when experienced managers steer the ship to new waters.

To all established fund managers: this is the time to use your experience and track record to bring along private investors into adaptation focused financial vehicles.

We need to see more money flowing towards climate adaptation, to support this experienced fund managers must take the lead

To support climate adaptation, fund managers must lead

To support climate adaptation, experienced fund managers must take the lead

I recently read Mariana Mazzucato’s [blog and UN policy brief](https://desapublications.un.org/un-desa-voice/sdg-blog/january-2025/blended-finance-not-working-it-time-new-approach-mobilizing) commenting on blended finance falling short of expectations and the need for a new approach to mobilising private finance. Her piece brought forth issues plaguing blended finance that should be addressed, such as the need for alignment of donors’ goals with those of developing countries themselves and the need for donor transparency.

As the global network for blended finance, [Convergence](https://www.convergence.finance/) exists to mobilise private investment into sustainable development through blended finance, and we’ve been doing it for nearly a decade. So, we wanted to respond to Dr Mazzucato’s piece and offer our own real world perspective on where blended finance is and how we think it needs to evolve.

While Dr Mazzucato states that blended finance has stagnated, the Convergence data she cites actually shows a notable rise in 2023. And the climate portion of the blended finance market in particular saw its highest ever annual financing total, growing by 120% to US$18.3bn in aggregate investment from $8bn the year prior – the entire market currently sits at around $23bn. Recently, we’ve also seen a small number of very large blended transactions come on the market that have the potential to be replicated and are providing much needed momentum (read more in the first story in [this edition of The Impact World This Week](https://www.pioneerspost.com/news-views/20241107/the-impact-world-week-7-november-2024)).

*To read the rest please visit [Pioneers Post](https://www.pioneerspost.com/news-views/20250205/opinion-blended-finance-isn-t-perfect-it-s-essential).*

Blended finance's real promise is not as a gap-filler, but a market enabler. 

Blended finance isn’t perfect, but it’s essential

*This op-ed was originally published in [Environmental Finance](https://www.environmental-finance.com/content/analysis/to-mobilize-private-capital-for-sustainable-development-we-need-standardization-at-scale.html).*

The world is at a critical juncture in the race to finance sustainable development. The United Nations estimates that achieving the Sustainable Development Goals (SDGs) will require annual capital investments of approximately $5 trillion, including $1.5 trillion for climate; but actual investment happens at only 15-20% of the level required. The total annual private investment mobilization is equal to only 1% of the $5 trillion, as estimated by UNCTAD. There is consensus that the SDG and climate investment gaps cannot be narrowed significantly without private investment mobilization at scale, which cannot happen without standardization of investment models.

We need to move away from bespoke mobilization activities and instead identify what has worked to date to mobilize private capital at scale and with impact, aligned to better debt sustainability, and double down on the most effective and efficient solutions. This need is directly addressed in the recently published [UN Financing for Development Outcome Document – Zero Draft](https://financing.desa.un.org/document/ffd4-outcome-document-zero-draft): "We support efforts towards the standardization of blended finance instruments to create effective and replicable structures."

In response to public sector initiatives and private sector calls to action, Convergence has launched the Scale Private Investment Mobilization Project to standardize and scale up effective and proven Private Investment Mobilization Models (PIMMs), creating a framework that makes it easier for private capital to flow into developing countries for sustainable development.

A limited number of PIMMs would address the three most important challenges to mobilize private investment: (i) creating a larger universe of viable projects, (ii) increasing project-level investability, and (iii) increasing portfolio-level investability. By addressing key barriers and clarifying how they differ depending on the context and the type of problem addressed, like perceived risk and regulatory constraints, a focused, limited number of PIMMs will make it possible for private investors to consider sustainable development projects in regions they otherwise eschew.

What does a set of effective PIMMs look like? Based on Convergence and partners' research, we have identified a set of 12 PIMMs to address the three challenges above.

One investment model involves public sector funding to part-fund private sector development companies to develop pipelines of viable projects, particularly in sectors like renewable energy.

Another model is public funding to organizations that issue Investment Grade (BBB) guarantees to reduce credit risk for projects with underlying weaker ratings, enabling private lenders to finance high-impact projects.

A third model is a three-tier blended finance fund that uses public funding in the junior tier and non-concessional public and private funding in the mezzanine tier to create a senior tier of capital for private investors – the diversification and subordination creates attractive investment assets (e.g., Investment Grade notes and bonds) that mobilize private investors at the portfolio level.

The impact of standardized PIMMs could be transformative. Preliminary models suggest that they could (i) increase private investment mobilized from current $50 annually to significantly larger amounts (hopefully multiples), (ii) increase investment aligned to debt sustainability (e.g., more equity and local currency debt), and (iii) materially decrease interest rates for developing country governments in one PIMM. Such an influx of sustainable investment would catalyze growth in critical sectors like infrastructure, healthcare, and agriculture, driving job creation, economic stability, and improved quality of life for millions.

Standardized investment models have the potential to provide a timely and practical roadmap to increase sustainable investment by mobilizing private investment at scale. However, realizing this vision requires a collaborative and consultative effort from developing countries (including Least Developed Countries and Low-Income Countries), governments, development finance institutions, private investors, and others that Convergence will facilitate in the first half of 2025, and ensure it aligns with other partners advancing on the standardization agenda. It is most critical that the international development community adopts the proposed standardized models and aligns their mobilization funding commitments accordingly.

The time to act is now. By standardizing and funding the best proposals / cases aligned to standardized investment models, we have a powerful tool to overcome the limitations of traditional private investment and development finance and unlock a new era of sustainable and inclusive growth. We believe we have identified a clear and direct path forward—one that bridges the gap between ambition and action, making a sustainable future possible for all.

To mobilize private capital for sustainable development, we need standardization at scale

The impact of standardized PIMMs could be transformative

BPL is a broker specializing exclusively in credit and political risk insurance (CPRI) for financial institutions, development finance agencies, multinational corporations, and investors around the world. They work closely with their clients to structure insurance programs for those engaged in international trade, investment, and lending, primarily to protect against the risk of non-payment by borrowers but also in-country political risks. Since their founding in 1983, they have settled over 600 CPRI claims, collecting over $4 billion on behalf of their clients. 

Investing in emerging markets often comes with high real or perceived risks. In development finance, risk-mitigating instruments such as non-payment insurance and political risk insurance are crucial to help increase origination capacity and adjust the risk-return profile of transactions so that private investors can enter developing countries. In addition to private investors, more development finance institutions (DFIs) and multilateral development banks (MDBs) are benefiting from these insurance products, bolstering their balance sheets and increasing their lending appetite. 

We spoke with Harry McIndoe, Director at BPL, about how insurance is used in the development finance market, BPL’s experience in the blended finance space, advice for those interested in partnering with insurers, and more.

__Can you tell us what products you focus on and the scope of the CPRI market?__

Our core focus is Comprehensive Non-Payment Insurance. This product is similar to a silent risk participation from an A-rated or double A-rated insurer that sits behind the policyholder, thus protecting them from losses on their funded or unfunded exposures. It covers non-payment for any reason so has a very simple trigger. There are roughly 60 active insurers in this space, all of whom are rated S&P A- or higher, with a large proportion now rated AA-. By swapping the counterparty rating with that of the insurer, institutions can recognise huge benefits in terms of balance sheet management and increasing their syndication capacity. 

BPL has been at the forefront of developing the market’s capabilities in recent years, and appetite has expanded to include a wide range of underlying debt instruments and structures. Another focus area is Political Risk Insurance, whereby our clients seek to cover certain specified cross-border country risks, such as expropriation, currency inconvertibility/non-transfer, and war.

__Why did BPL decide to become involved in development finance?__

Helping mobilize finance to where it is needed most has always been a cornerstone of our work. We have been active in development finance since our inception, helping both commercial and non-commercial institutions mitigate credit and country risk exposures, enable larger ticket sizes, and manage capital/balance sheets. Increasingly, we are seeing the power of insurance in derisking development finance. It has been applied across a wide spectrum of underlying exposures and stretched tenors, in the midst of long-term and disruptive trends.

We are keenly aware that CPRI has an important, and sometimes underestimated, role to play in enabling and accelerating the flow of funds to support sustainable objectives – including the transition to a low carbon economy and the mobilization of sustainable finance to developing markets. As an insurance broker we recognize that our ability to directly influence client investments and lending decisions is limited, nevertheless our clients value our support in helping them accelerate towards sustainable objectives. Additionally, our leading market position enables us to offer incisive market intelligence and drive product innovations that support the proliferation of sustainable finance, infrastructure, investments, and ambitions.

__The use of non-payment insurance in blended finance is still niche and often provided by DFIs/MDBs themselves. How has BPL participated in the blended finance space?__

Our work with DFIs/MDBs has primarily been on projects supporting the United Nations Sustainable Development Goals (SDGs), such as financial inclusion, infrastructure, healthcare, sanitation, and utilities. While some of these institutions do issue guarantees/risk covers themselves, many work with the private insurance market to increase origination capacity and syndicate a portion of their own balance sheet exposures.

When it comes to MDBs, non-payment insurance is increasingly relevant in helping to action the recent G20 Capital Adequacy Framework recommendations, which underscores the importance of insurance for enhancing lending capacity and enabling MDBs to leverage their balance sheets. 

In addition, we are often asked to secure non-payment insurance on projects for commercial lenders where there is DFI/MDB involvement, such as project finance transactions where a DFI might be a co-insurer or lender, A/B loans, and more recently, on “repack” transactions whereby private institutional capital can be crowded in with the benefit of A/AA rated insurance coverage. 

Another area where we see engagement is on portfolio and securitization solutions, where the insurance market has considerable appetite to support DFIs/MDBs through a more programmatic approach to risk-sharing and capital management, providing significant benefits at scale.

Our insured portfolio currently stands at approximately $87 billion, with nearly 60% in developing countries. This scale gives us an accurate finger on the pulse of the market and equips us with a real-time view of market appetite across global markets and underlying project types.

__What have you learned about the role of the insurance brokers in blended finance transactions?__

MDBs/DFIs are not too different from commercial financial institution clients in terms of gleaning the best results out of the CPRI market. 

One of the challenges facing insurers in the development finance space is the risk profile of their transactions. DFIs/MDBs have a development mandate, while CPRI insurers active in the market must answer to commercial capital providers. The role of a broker is to navigate this occasional disconnect, underlining the MDB’s preferred creditor status and securing the optimal coverage at the right price, all while keeping in mind that there is a finite amount of credit risk that insurers are willing to take in certain countries.

__What advice would you give to participants in the blended finance market interested in partnering with the insurance industry?__

A potential risk factor for less experienced DFIs/MDBs when it comes to using CPRI can be a lack of understanding of the product or the insurance market. This emphasizes the importance of using a broker who understands the market and can guide them through the process – ideally one with extensive emerging market experience and a good claims track record. These factors help indicate the strength of the broker in building goodwill and relationships with the insurance market on behalf of its client. 

Another critical element when engaging with the insurance market is partnership. If participants embrace that partnership approach and transparency with the market, they can count on a long and fruitful collaboration. Indeed, we find insurers see a lot of value in projects and expertise from DFIs/MDBs and in their origination strategy. Further, insurers tend to appreciate the portfolio and market diversification that such partnerships offer them.

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

The SDG funding gap is a huge area of concern that CPRI can play a vital role in bridging. According to the 2024 Financing for Sustainable Development Report, SDG financing and investment gaps are estimated at between $2.5 trillion and $4 trillion annually. At BPL, we are keen to continue building on our 40-year commitment to the development finance space and advocating for the huge value for development financiers that comes from working with the CPRI market. We expect to see much more involvement for BPL as the role of insurance in helping DFIs/MDBs meet their objectives becomes more visible and as insurer appetite becomes increasingly supportive.

Learn how insurance is used in the development finance market, BPL’s experience in the blended finance space, advice for those interested in partnering with insurers, and more.

BPL Member Spotlight

BPL Member Spotlight with Harry McIndoe

*This op-ed was originally published in [Impact Alpha](https://impactalpha.com/if-foreign-aid-and-climate-action-is-out-blended-finance-must-step-in/).*

As President Trump begins his second term, uncertainty pervades climate, development, and sustainable finance communities. His first few days in office have already seen an order to withdraw from the Paris Agreement and a 90 day pause on foreign assistance. If history is any guide, we can expect further rollback in climate action and a retreat from the multilateralism critical to advancing the Sustainable Development Goals.

At the same time, we have already seen unprecedented cuts this year in development aid in other countries such as [the Netherlands](https://www.devex.com/news/unprecedented-cuts-leave-dutch-civil-society-organizations-reeling-108763) and [Germany](https://www.devex.com/news/germany-plans-billions-in-cuts-to-development-humanitarian-aid-108259).

Amidst this uncertainty, one tool stands out as uniquely resilient: blended finance. Designed to mobilize private capital by de-risking investments in sustainable development in emerging markets, blended finance has proven itself in recent years to be an adaptable and resilient approach, particularly in challenging political and economic climates.

The blended finance market has witnessed unprecedented growth in recent years, signaling a maturing ecosystem that is increasingly capable of mobilizing private capital at scale. In 2023, private sector capital flows to climate blended finance deals [grew by almost 200%](https://www.convergence.finance/resource/state-of-blended-finance-2024-climate-edition/view). That same year witnessed the emergence of multiple “whale deals”—transactions exceeding $1 billion—demonstrating that the sector can consistently blend billions and attract private investment. This marks a watershed moment for blended finance, showcasing its ability to operate at a scale and sophistication necessary to meet today’s global challenges.

__New players__

Recent landmark transactions highlight this evolution, demonstrating how innovative financial structures are unlocking billions in private capital for critical development needs. For example, The SDG Loan Fund, closing at $1.11 billion, [leveraged catalytic capital](https://impactalpha.com/allianz-sdg-loan-fund-leverages-a-25-million-guarantee-to-catalyze-1-1-billion/) from FMO and the MacArthur Foundation to unlock private investment for energy and agriculture in emerging markets, while ALTÉRRA, a $30 billion global investment fund focused on climate solutions, was launched with $5 billion in catalytic capital specifically allocated to support the global south.

Meanwhile, Singapore’s FAST-P initiative aims to raise $5 billion for green and transition projects in Asia. This trend marks a significant evolution and indicates that blended finance has reached a level of scale and utility where it can weather political, social, and economic storms. Even as COP29 concluded in late 2024 without significant consensus, delegates appeared to agree on one point: achieving global climate goals will require increased participation from the private sector.

Multilateral development banks (MDBs), development finance institutions (DFIs), and foundations remain central players. But the entry of new actors such as insurance companies play an enabling role in driving the creation of larger scale innovative structures that make blended finance more versatile and resilient. For instance, Respira utilized a Voluntary Carbon Credit Insurance product developed with Howden Group to mitigate risks like fraud and regulatory non-compliance, enabling the scaling of reforestation projects and securing $510 million in investments.

Institutional investors, including pension funds, are also beginning to incorporate blended finance as a tool to meet sustainable investment mandates, enabling greater participation in high-impact projects. PensionDanmark, with over €40 billion in assets under management, has invested in blended finance funds across agriculture, energy, and financial services sectors to support sustainable development. Similarly, Swedish pension provider Skandia has committed $100 million to the SDG Loan Fund, targeting key sectors for climate transition in developing countries. The result is an ecosystem that not only continues to grow but becomes increasingly adaptive to changing circumstances.

__Filling the void__ 

Historical precedent highlights why blended finance is likely to maintain its momentum. In the wake of a global pandemic, escalating geopolitical conflicts, natural disasters, inflationary pressures, and mounting debt burdens – a period when global climate and development finance came under pressure – blended finance mechanisms stepped into the void. While public budgets shrank, blended finance vehicles were able to mitigate investment risks in critical sectors like renewable energy and infrastructure.

We anticipate that as development aid constricts, the need for blended finance will only grow. More restrictive policy environments will only amplify the need for tools that can overcome barriers to investment in developing markets. Blended finance is specifically designed to counteract prohibitive conditions, using public and philanthropic funds to reduce risks and incentivize private sector participation. This de-risking function makes blended finance particularly well-suited to ensuring that critical investments in climate resilience and sustainable development continue even in the face of political headwinds.

This pivotal juncture demands immediate action. The international community must seize this moment to double down on blended finance as a critical tool for global development. Governments, DFIs, and philanthropic organizations should enhance their support for blended finance mechanisms, prioritizing the standardization and scaling of successful models. Private investors, too, have a vital role to play, leveraging these mechanisms to align their portfolios with sustainable outcomes while achieving attractive returns.

While political uncertainty may test the resilience of global development efforts, it also highlights the enduring value of innovative financing models. By embracing blended finance as a cornerstone of climate finance and sustainable development, we can ensure that progress continues—regardless of the political landscape.

If foreign aid and climate action is out, blended finance must step in. This is a watershed moment for blended finance, showcasing its ability to operate at a scale and sophistication necessary to meet today’s global challenges. 