Follow us

Blue Orchard Covid-19 Emerging and Frontier Markets MSME Support Fund

Overview

About

Blue Orchard is a leading global impact investment manager that is dedicated to generating lasting positive impact for communities and the environment, while aiming to provide attractive returns to investors. Blue Orchard’s Covid-19 Emerging and Frontier Markets MSME Support Fund is a facility set up to address the liquidity and solvency challenges faced by MFIs due to the Covid-19 crisis.

Investment Details

Name

Blue Orchard Covid-19 Emerging and Frontier Markets MSME Support Fund

Tagline

Providing solutions to the liquidity and solvency challenges of inclusive financial services institutions caused by volatility in financial markets

Sector

Financial Markets

Location

Kenya, Tanzania, Burkina Faso, Nigeria, Botswana

In portfolio since

2020

Our role

  • FSDAi made an exceptional Covid-19 response investment in Blue Orchard to support MFIs to access liquidity during the pandemic.
  • This investment ensured poor households and micro and small businesses impacted by the fallout of COVID-19 continue access to microfinance
  • We provided high-risk capital by investing in Junior Limited Partnership Interests acting as a first loss buffer to the senior positions. This approach not only secured investors’ commitment to the fund but also ensured that Africa received a fair share of the fund’s investment

Our investment

Committed capital: £7.2 million

Instrument:  Junior Limited Partnership Interests that act as a first loss buffer in the AfrAsia sub fund that lends to African and Asian MFIs. The Fund has raised $235.78 Million as at October 2022

Purpose and target market

  • Through our investment, we aimed to enable financial institutions in emerging and frontier markets to cope with the impact of Covid-19 on their operations and portfolios by accessing immediate liquidity and longer-term finance to avert insolvency
  • The Fund’s support enabled MSMEs to remain operational across sectors, allowing entrepreneurs and employees to maintain their jobs and have access to financial and non-financial support during and after the Covid-19 crisis. The fund’s support also ensured that poor households and informal businesses preserve revenue, incomes, and jobs.
  • FSDAi’s investment also had a ‘test and learn’ rationale – providing an opportunity to assess the relevance of such a facility, from a market building perspective, in the face of future pandemics and climate shocks that impact financial institutions and the clients they serve

Impact to date

4 million MSME reached by MFIs in the Sub-fund’s portfolio who continued to operate and provide support through the COVID pandemic

4510 Jobs maintained and/or created

92% Women served by the fund, spread across mostly peri-urban and rural areas

The BlueOrchard’s Covid-19 Emerging and Frontier Markets MSME Support Fund is a key facility that will help mitigating some of the challenges of the pandemic. We thank the FSD Africa team for supporting our efforts to provide vital financing to micro, small and medium-sized enterprises in Africa. We are proud that we have successfully brought together a renowned group of public and private actors to pave the way for recovery and preserve vital jobs across sectors.

Philipp Mueller, Chief Executive Officer
BlueOrchard Finance Ltd

Investee contacts

BlueOrchard Finance S.A., 9th Floor – Unit 22, Pine Tree Plaza, Kaburu Drive, off Ngong Rd, Nairobi, Kenya

+254 745 237 750

info.nairobi@blueorchard.com

FSD Africa contact

Riverside Green Suites (Palm Suite), Riverside Drive, Nairobi
FSDAi-info@fsdafrica.org

Updated: October, 2022