In developing countries, social, economic and health benefits can be directly linked to the usage of clean energy. In this context, the advantages of microfinancing of renewable and energy efficient products for low-income households and micro, small, and medium enterprises (MSMEs) are widely recognised. Microfinance institutions acquire their funding from different sources including international funds.
The Microfinance Initiative for Asia (MIFA) Debt Fund focuses on sustainable, commercially viable MFIs providing financial services to the poor. As a public-private partnership it is funded by equity investments, as well as mezzanine and senior loans from government institutions – the German Federal Ministry of Economic Cooperation and Development (BMZ), the European Union (EU), the Kreditanstalt für Wiederaufbau (KfW), International Finance Corporation (IFC) and private investors.
The Junior Tranche of the MIFA Debt Fund is to be increased in order to promote renewable energy and energy efficiency investments by households and MSMEs in South and South-East Asia. adelphi has been commissioned to develop a programme for this new component within the MIFA Debt Fund Junior Tranche that targets these technologies. In order to achieve a feasible and effective structure, adelphi in cooperation with ArcFinance and Climate & Energy Solutions conducts market assessments in the target countries complemented by document reviews and stakeholder analyses. The resulting study will provide KfW and the Fund with distinct recommendations for the set-up and implementation of a new component including the integration into the existing MIFA portfolio.