Time for refugee investments to size up
The first refugee investment impact bond is poised to launch in 2019.
Belgian impact finance firm Kois Invest began working on an impact bond for job creation for refugees in 2016 in response to the refugee crisis, funded through a grant from non-profit Convergence in Canada.
The goal is to create a bond structure in which private investors supply working capital to service providers that are delivering evidence-based livelihood programmes to Syrian refugees. Investors are paid back if and when social outcomes are achieved, with a financial return that varies with the level of social impact.
Kois is now in the final stages of structuring the multi-service provider bond and hopes to launch the deal early to mid next year.
Despite large amounts of private-sector money being committed to financing refugee-related investments, very few deals have taken place. This is now beginning to change.
Justin Sykes is the founder of Innovest Advisory, a boutique impact investment firm that has been looking at matching private clients with refugee-related investments over the last three years. He says that momentum seems to be growing.
“We’ve had a period of inertia and frustration where large, high-level commitments to refugee investments haven’t translated into deals,” he says.