10 July 2024
Financial services
Why we invest in this sector
To varying degrees, the financial sectors of African and South Asian countries are all under-developed.
Businesses find it difficult to borrow, capital markets are narrow and illiquid, insurance and other risk management products are unavailable, and large portions or the population have no bank account. Our financial sector investments are aimed at fixing these problems.
Our strategic focus
- Investing to develop capital markets to unlock further funding over the long term
- Working with financial intermediaries to reach SMEs
- Supporting specialised financial service providers to meet people’s ‘basic needs’
- Investing to harness the transformative power of digital financial services
- Providing capital to support the transition to net zero and resilient economies
- Investing to advance gender equality and women’s economic empowerment
Who we partner with
We support the development and growth of financial services across our markets by investing in a broad range of financial institutions and partners:
Financial services
- Non-bank financial services: Including leasing companies, infrastructure finance, mortgage companies, and microfinance institutions
- Fintech and market infrastructure: Including payment switches, credit bureaus, digital lenders, and stock exchanges
Financial institutions
- Insurers: Including life insurance, reinsurance, property and casualty insurance, and micro-insurance
- Banks: Including commercial banks, and microfinance banks
- African regional DFIs
You can read more about how and why we invest in financial services in our sector strategy.
Products
We provide a range of capital solutions across this sector
Equity
Ticket Size ($) 10m+- We invest to support value creation
- We take minority stakes in the capital of financial institutions
- Equity and debt can be used in conjunction
Debt
Ticket Size ($) 10m+- We provide term debt financing
- Senior and subordinated debt through bilateral/syndicated loans or bonds
- We focus on SME, gender and climate lending
- Equity and debt can be used in conjunction
Risk sharing
Ticket Size ($) 10m+- Guarantees or co-financing on term loans
- Supports better access to credit
- Our focus is on SMEs and microfinance companies
Trade finance
Ticket Size ($) 15m+- Trade finance loans and risk sharing facilities
- Aimed at increasing liquidity and/or reducing capital costs
- Provided through warehouse receipts, purchase orders and receivables finance
