The Emerging Market Impact Investment Fund (EMIIF) contributes to inclusive, gender equal and sustainable economic development in Asia and the Pacific by providing much-needed financing to early- and growth-stage SMEs while shaping the impact investing and gender lens investing (GLI) market of the region.
We are proud to share the first EMIIF Impact Study. Produced biennially by Alinea-Whitelum the impact study tracks EMIIF’s journey and showcases the transformation potential of its underlying fund managers and their portfolio companies during 2021 and 2022. The study also explores early evidence of the financing mechanism’s impacts at micro (firm) and macro (market) levels:
1 dollar of EMIIF investment mobilizes 5 dollars from the private sector
Recognising that SMEs are major drivers of inclusive economic growth, but often lack access to capital they need to scale, EMIIF applies a Fund of Funds model to address the gap. EMIIF invests in several SME Funds and other financial intermediaries that, in turn, invest in early- and growth-stage SMEs that will deliver impact and financial returns.
EMIIF has demonstrated its ability to deploy catalytic investment and generate private sector leverage. EMIIF has committed AUD 16.7 million (70% of its total investable capital) to three SME Funds in Southeast Asia, and mobilised AUD 94 million in private investment and co-invested this alongside AUD 126 million in public investment including DFIs. EMIIF’s 1:5 mobilisation rate is above benchmarks for Asia and the Pacific.
Investments created new jobs and paved the way for women to scale their businesses
EMIIF has helped unlock capital for 16 portfolio companies in Vietnam, Indonesia, Bangladesh, and the Philippines. EMIIF’s investments have generated 2,651 new full-time equivalent jobs of which 59% are for women.
Technology has become an accelerator for small businesses and two of three EMIIF fund managers invest in fintech. More than 10,000 microentrepreneurs and SMEs were indirectly financed through these fintechs. The majority (96%) of fintech clients are women-owned or led.
Continuous improvements toward diversity, integrity, and sustainability
EMIIF’s Technical Assistance helped fund managers to create or improve existing Environment, Social and Governance (ESG) policies, create impact frameworks, embed gender considerations in existing strategies, policies, and processes, and to apply DFAT safeguarding standards.
As a result of EMIIF’s technical assistance, there is an improved participation of women leadership and employees at firm level. Prior to EMIIF’s investment, one Fund Manager did not have women in leadership position but at present, women represent 27% of leadership team and 48% of employees. On average, there are 66% of women employees and 51% of women leaders in fund managers supported by EMIIF.
Influencing market confidence and commitments
Throughout its investment process, EMIIF has built strong working relationships with key investors, including the DFI community and Australian impact investors. Private investors have noted EMIIF’s high-quality due diligence as valuable support during their investment process.
EMIIF’s development finance offering, particularly its first loss investment facility, has proved to be additional to de-risking investments and building market confidence, eventually unlocking commercial capital in the same transaction or future deals.
EMIIF is managed by Sarona in a consortium with MEDA and SAGANA as technical assistance providers and Alinea-Whitelum which authors independent EMIIF impact reports. As of end of 2022, Lendable MSME Fintech Credit Fund, Ascend Vietnam Ventures Alpha (AVV) and Southeast Asian Women’s Economic Empowerment Fund (SWEEF) are the three EMIIF SME Fund Managers in EMIIF’s portfolio.