Grameen Impact Investments India and Acumen India have launched a Rs 10 crore ($1.4 million) bond which will provide credit to for-profit enterprises targeting skill development in the country.
According to a statement, there will be five beneficiaries of the bond -- called LIFE (Livelihood Innovation Fostering Economy), which is an impact bond focused on sustainable development goals. These are LabourNet Services India Pvt. Ltd, Empower Pragati Vocational and Staffing Pvt. Ltd, Edubridge Learning Pvt. Ltd, iStar Skill Development Pvt. Ltd and iPrimed Education Solutions Pvt. Ltd.
The bond’s goal is to help skill and train up to 20,000 people and to achieve a 70% employment rate among those trained, the statement added. The overarching goal is to help India achieve sustainable development goals laid down by the United Nations including decent work and economic growth, the reduction of inequality and eradicating poverty.
Acumen India country director Mahesh Yagnaraman said the bond was the first of its kind because of its “outcomes-based funding model”.
“Our end goal is to draw more support and capital…towards outcome-funded instruments that can catalyse development in this area,” Yagnaraman added.
This is the second sustainable development goals-focussed bond launched by Grameen. The first one – Women Holistic Empowerment and Enhanced Livelihood – was launched in collaboration with ChildFund India to train tribal women in Maharashtra and Madhya Pradesh to help them become self-reliant.
Established in 2007, Grameen Impact Investments is a non-banking financial company focused on lending to social enterprises. It was originally launched as a joint venture between the Grameen Foundation, Citicorp Finance and IFMR Trust. In 2012, Patni scions Arihant and Amit Patni bought out IFMR’s holding for an undisclosed amount.
The firm says its goals are to promote inclusive growth and help impact-focussed enterprises gain access to capital markets through means such as debt and equity financing and other investment banking solutions.
Acumen, founded in 2001 with seed capital from institutions such as the Rockefeller Foundation and Cisco Systems Foundation, says it raises funds to invest in entities that deliver goods and services to low-income groups across the world.
The group’s investments in India span several sectors including drinking water and sanitation, formal housing and healthcare servicing. In 2017, Acumen announced its first India-focussed fund.