, $152.5 million fund seeks to enable financial institutions){kind=link}
Global nonprofit Accion has launched the Accion Digital Transformation Fund (ADTx), $152.5 million fund seeks to enable financial institutions to better meet the needs of small businesses that are currently excluded from the financial system by providing growth capital and strategic support for digital transformation.
The fund will build on Accion’s experience supporting banks and finance companies around the world to connect millions of small businesses and individuals to the digital economy and is managed by Accion Impact Management and will invest in companies serving micro, small, and medium enterprises across South and Southeast Asia, Latin America, and Africa in equity and quasi-equity investments, plus hands-on strategic support and networks.
Michael Schlein, President and CEO of Accion, said: “With global poverty on the rise for the first time in decades, Accion is on a mission to bring cheaper, customer-friendly financial solutions to the nearly two billion people who are failed by the financial system. Leveraging third-party capital is a critical part of our strategy. With the Accion Digital Transformation Fund, we expect to connect millions more small businesses to the digital economy, providing high-quality, affordable financial services that help reduce poverty and create opportunity.”
Since 1961, Accion has helped build more than 230 financial service providers serving low-income clients in 75 countries, reaching more than 350 million people.
Initial investments by the fund include Annapurna Finance and IKF Finance in India, with up to 12 total expected. Limited partners in the fund include British International Investment (BII), the UK’s development finance institution and impact investor; the Dutch entrepreneurial development bank FMO; IDB Invest; International Finance Corporation (IFC); Mastercard; OeEB the Development Bank of Austria; and Swedfund, Sweden’s development finance institution.
Njord Andrewes, Managing Partner, Accion Digital Transformation Fund, said: “We believe finance companies have an enormous opportunity to scale efficiently using digital technologies and better client engagement. Through capital, active board participation, shareholder engagement, and strategic support we seek to drive the digital transformation agenda of these companies, enabling them to better serve small businesses.”
Abhishek Agrawal, Managing Partner, Accion Digital Transformation Fund, added: “We believe the level of commitment from our high-caliber limited partners speaks to the urgency of our work. We look forward to working with more financial institutions to bring affordable, high-quality financial services to small businesses globally.”