Zurich-based impact investor responsAbility Investments AG has launched a climate debt fund focussed on emerging countries and markets, with a strong focus on Sub-Saharan Africa and Southeast Asia.
In a statement, responsAbility said it is seeking to raise $200 million for the fund and that it has reached its first close of $151 million (approximately Rs 1,070 crore). It aims to mark the final close of the fund later this year.
The private debt fund has a blended finance structure offering different risk tranches, the impact investor said.
The fund has received commitments from AHL Venture Partners, Ashden Trust, Bank of America, Bohemian Impact Investments, Calvert Impact Capital, European Investment Bank, Dutch development financier FMO, International Finance Corporation and the government of Luxembourg, among others.
“By partnering with entrepreneurs as a first commercial lender, we want to enable clean energy businesses to scale up their activities and attract more funding in the long run,” said Antoine Prédour, who oversees responsAbility’s debt financing.
The investment vehicle will target companies providing solutions to households without access to basic amenities such as electricity as well as businesses looking for cleaner and cheaper forms of energy. responsAbility said that the fund is also the first of its kind to actively address the solar energy potential for the commercial and industrial sector.
“By providing debt to companies supplying off-grid and distributed energy generation solutions to households and SMEs, the Fund will fill an important financing gap in a sector that is essential to achieving both economic and social development,” European Investment Bank vice-president Emma Navarro said.
The impact investor said it expects portfolio companies from the fund to provide power to more than 150 million people, add over 2,000 megawatts of clean energy generation capacity and reduce carbon dioxide emissions by at least six million tonnes.
Founded in 2003, the Swiss impact investor provides debt and equity financing predominantly to unlisted companies in emerging economies. With at least $3 billion of assets under management, it has invested in about 540 companies in 90 countries, its website shows. It has been quite active in India, especially in the financial services sector.
In August last year, it led a $10 million debt funding round in Aye Finance Pvt. Ltd., which offers working capital and business development loans to micro and small enterprises.
Before that, in July, it committed $9.4 million to microfinance company Satin Creditcare Network Ltd. In April, it invested $10 million in green masala bonds issued by Pune-based non-banking finance company Electronica Finance Ltd.