The Pioneer Facility will provide affordable working capital loans to social entrepreneurs who create sustainable solutions and help developing countries meet growing energy demands.
With the Pioneer Facility, Nexus aims to raise 6.5 million USD to capitalize an innovative fund to support at least 20 social enterprises over the next four years. The Pioneer Facility will combine funds from grants, recoverable grants, and impact finance to provide affordable working capital loans to these enterprises. This blend of finance is a key element of the facility which will mitigate risks while providing affordable debt.
The Pioneer Facility will invest in social businesses which meet the following criteria:
• Technologies: clean energy and clean water technologies benefiting low-income populations, such as clean cookstoves, solar, water purification and waste-to-energy systems;
• Geographies: Asia, with potential for strong cases in Africa;
• Impacts: products and services must contribute to the fight against poverty and climate change;
• Organization and financing: enterprises in a growth stage that can demonstrate the viability of their project with a strong business case.
General loan terms
The Pioneer Facility’s Investment Committee will review all applications and determine final loan terms, but the following are the general terms of a Pioneer Loan:
• Loans disbursed in tranches
• 70% of loans will be disbursed in USD
• Up to 30% of loans can be disbursed in local currency
• No collateral required
• Funds may be used for operating or capital costs for growth
• 250-350,000 USD
• 10% annual interest
• 3 year maturity
Nexus’ key results since 2011
• More than 16 projects supported, including six registered or pending registration under a renowned certification body (Gold Standard);
• Over 1,000,000 carbon credits issued and sold, worth 5.0 million USD in project finance;
• Management of two debt facilities with five deals closed and three expected to be closed by the end of Q1 2016.
If you are a social enterprise that meets the criteria, contact Nexus for a loan application.