Responsible Investment Management and Advisory Services

Expanding the SME finance offer across emerging markets and developing countries

With 13 new investments, DGGF track ‘Investment funds local SMEs’ saw a substantial increase of committed capital from EUR 97M in 2016 to EUR 181M in 2017. DGGF’s supplementary Seed Capital and Business Development program (SC&BD) experienced similar growth with cumulative commitments increasing from EUR 8.4M to EUR 16.6M.

Africa
In Southern Africa, investments into Inside Equity Fund and Spear II have supported better access to risk capital for SMEs in Zambia, Madagascar, Malawi, South Africa and Zimbabwe. In East Africa, DGGF supported Zoscales, which provides growth capital for unserved SMEs in Ethiopia, and EFTA which is pioneering lease finance to SMEs primarily in rural areas of Tanzania. Additionally, DGGF helped two institutions of the Access Holding network to scale their SME loan product in Rwanda and Zambia. In West Africa, DGGF supported two more institutions of Access Bank in Nigeria and Liberia, and backed Fafin, an agribusiness fund aiming to improve food security in Nigeria.

The report #ClosingTheGap francophone West Africa was released. Support to three organizations will address gaps identified in the report: Suguba, a regional network of Impact Hubs started in Mali and expanding into Senegal and Ivory Coast; EtriLabs, a technology innovation hub in Benin; and Innov’Up, the first women-dedicated incubator in Togo.

Middle East
In Jordan, DGGF financed Sanadcom – a fully dedicated SME lender – to extend more loans to SMEs, many of which are owned by young or female entrepreneurs. Seed financing to Liwwa – Jordan’s first digital lender catered to small businesses – brings affordable and unsecured loans for trade and asset financing. DGGF also reached out to the Palestinian Territories with an investment in FATEN, an NGO financial institution scaling its SME product, and provided seed capital to Ibtikar, a first-time fund targeting innovative Palestinian early stage companies.

Caucasus and (Central) Asia
Through a combination of investment and technical assistance (TA), DGGF is supporting Gazelle Finance Fund to provide mezzanine financing to growth stage SMEs in Georgia, Armenia, Moldova, and Kyrgyzstan. In Armenia, TA to DGGF investee SEF contributes to the professionalization of staff in servicing their new client segment, i.e. SMEs. DGGF also supported Xac Bank – a dedicated SME lender in Mongolia – to resume the growth of its SME loan portfolio after an economic recession and local currency devaluation.

South-East Asia
The impact of DGGF investments in the region has been strengthened through the support to DGGF investee Aavishkaar in fostering the activities of local angel networks’ in Bangladesh and Indonesia; through seed capital investments in SMEcorner – a fintech start-up in India that leverages digital technologies to quickly serve small businesses at competitive pricing; and in the Nepal Impact Investment Club (NIIC) that serves the lower end of the “missing middle.”

Latin America
Similarly, DGGF’s investment in Genesis – an SME lender in Guatemala – is enhanced by the support in establishing business centers in three rural areas, while seed capital to Sempli – a pioneer digital lender in Colombia – will foster the deployment of debt financing to unserved local SMEs.