Debt fund EBF II secures US$10m from FMO for contribution of biodiversity conservation

AFRICA – FMO, a Dutch development bank, has approved the commitment of US$10 million in senior shares of Eco.business II Sub-Fund (EBF II), an open-ended debt fund managed by Finance-In-Motion.

EBF II aims to promote ecologically sustainable businesses, with a special focus on fighting deforestation in Sub-Saharan Africa, through the provision of dedicated financing and technical assistance.

The eco.business II Sub-Fund was initiated by Germany’s KfW Development Bank with financial support from the German Federal Ministry for Economic Cooperation and Development (BMZ).

The investment by FMO will be used on-lent to local financial institutions that target sustainable businesses/projects (i.e. certified or identified as green).

In addition, the Fund looks to set up strategic partnerships with commodity buyers to finance smallholders and also to finance high impact projects directly.

Priority sectors will be sustainable agriculture, fishery, forestry and tourism. Based on the expected portfolio composition, the investment has been categorised as Category B, in accordance with FMO’s Sustainability Policy.

“FMO’s investment in EBF II will contribute to biodiversity conservation and sustainable use of natural resources, which is directly in line with SDG 13. Being one of the first investors, FMO’s stamp of approval is expected to attract additional investors to the Fund,” said FMO.

Finance in Motion is an impact asset manager exclusively focused on development finance. With over US$2 billion in assets under management, the company develops and advises investment vehicles that promote the Sustainable Development Goals.

The eco.business Fund aims to promote business and consumption practices that contribute to biodiversity conservation, to the sustainable use of natural resources, and to mitigate climate change and adapt to its impacts.

By providing financing for business practices that conserve nature and foster biodiversity, the fund seeks investments with both environmental and financial returns. The fund mainly provides loans to qualified financial institutions that on-lend the money to eligible borrowers, which include holders of recognized certifications or those making improvements in line with conservation and biodiversity goals.

The fund supports sustainable operations in the sectors of agriculture, fishery (including aquaculture), forestry and tourism.

The eco.business Fund was initiated by Germany’s KfW Development Bank and Conservation International with financial support from the German Federal Ministry for Economic Cooperation and Development (BMZ).

It has received further donor support from the European Commission The fund’s additional investor base comprises IDB Invest, a member of the Inter-American Development Bank (IDB) Group, the U.K.  government’s Department for Environment, Food and Rural Affairs, Dutch development bank FMO, Austrian development bank OeEB, and institutional investors such as sustainable banking institution ASN Bank, German ethical bank GLS Bank, Calvert Impact Capital, and Raiffeisen Bank International.

Operating hand-in-hand with the eco.business Fund, the eco.business Development Facility provides high-impact technical assistance to financial institutions and final borrowers.

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