- Focus will be on women entrepreneurs, rural clients, predominantly farmers, and other vulnerable men and women seeking greater financial inclusion
- Bond seeks to balance favourable financial return on investment with demonstrable social impact
- FIIG Securities acts as lead arranger; Austraclear acts as bond agent; Perpetual acts as bond trustee
SYDNEY, LONDON – 14 November 2019 – VisionFund International (VisionFund), the mission-focused microfinance subsidiary of children's charity World Vision, today announces it has raised AUD20 million with its first bond issue. In alignment with World Vision’s focus on children’s well-being and with the UN’s Sustainable Development Goals of promoting sustainable economic growth (SDG 8) and gender equality (SDG 5), the proceeds of the bond will be used for providing financial services, mainly microfinance loans, to families living below the poverty line in developing countries. The bond is being arranged by FIIG Securities Limited (FIIG), Australia’s largest fixed income specialist and represents FIIG’s first foray into impact investment.
Offered in Australia to eligible institutional and high net worth investors, the bond is known as a ‘Kangaroo bond’ as it is issued in Australia in Australian dollars by a non-Australian entity. The five-year bond is unsecured and unsubordinated and offers a fixed rate of five per cent per annum, paid semi-annually.
Since inception in 2003, VisionFund has provided 16 million loans totalling around USD9 billion, introduced savings and microinsurance products to promote client resilience and provided financial literacy training and business education. Through its network of microfinance institutions located in 28 developing countries around the world, VisionFund serves over a million clients, the vast majority of whom are women and often the main income generator and caregiver for their families.
The funds raised from the bond issue will be used by VisionFund to on-lend to and grow its microfinance institutions which complement World Vision’s economic development work. These microfinance institutions require debt funding to expand their reach and impact, and serve vulnerable people and communities that would otherwise find it difficult to access loans, savings and insurance products. These financial inclusion services enable families to grow their businesses, increase incomes, manage their finances and strengthen their livelihoods to provide brighter futures for their children.
Globally, 1.7 billion adults are without a bank account at a financial institution or with a mobile money provider and 56% of these are women.1 The vast majority of the unbanked live in developing countries; a quarter of them are among the poorest 20% of their economies making their families particularly vulnerable to the effects of financial emergencies such as sudden job loss or bad harvest.
Claire Rogers, CEO of World Vision Australia said:
“This new channel of fundraising for VisionFund brings a unique social impact investment opportunity to Australians. Investors will help VisionFund to deliver enormous social benefit by assisting primarily poor women to sustainably lift their families out of poverty by growing small businesses and increasing their family’s incomes. We appreciate that investors recognise the power of World Vision’s work and are joining us to change the lives of the world’s most vulnerable children.”
Michael Mithika, President & CEO of VisionFund International said:
“We are grateful to World Vision Australia and all of our partners who have helped bring this to fruition in order to strengthen livelihoods and deliver impact for good for vulnerable children and communities around the world. This partnership paves the way for life in all its fullness for vulnerable families and children on the journey out of poverty.”
Jim Stening, Managing Director, FIIG said:
“VisionFund International’s bond is an important milestone for FIIG and the Australian bond market in a number of ways. It is the first time we have brought an impact investment product to market, with the VisionFund bond meeting the growing appetite amongst Australian investors for purpose-driven investment without sacrificing returns. We are honoured to be able to partner with VisionFund to arrange the fundraising, enabling Australian investors to directly support tens of thousands of vulnerable individuals around the world so that they can take care of their families and create better futures. From our team’s perspective, arranging this fundraising on a pro bono basis is a high impact form of “exponential donation” and we are all very proud to be supporting the world-leading work of VisionFund.”
In addition to FIIG who is arranging the bond and has waived all of their fees to both VisionFund and their clients, Perpetual Trustees have also provided 100% pro-bono services. Other partners who have contributed pro-bono services in part include King & Wood Mallesons and MinterEllison, both providing legal services, and the Australian Securities Exchange through their subsidiary Austraclear.
ABOUT VISIONFUND INTERNATIONAL
VisionFund International, World Vision’s microfinance subsidiary, has been improving the lives of children in the developing world for over 16 years. By offering small loans and other financial services, clients develop successful businesses, enabling their children to grow up healthy and educated. In FY2019, VisionFund International’s network of microfinance institutions provided loans to one million clients, with nearly three-quarters of these going to women and over a third to clients actively involved in farming. Repayment rates were 97.8%. Also, in FY2019, 3.5 million children were positively impacted through its MFI network located across 28 countries in Africa, Asia, Eastern Europe and Latin America.
For further information please visit: VisionFund.org
ABOUT WORLD VISION AUSTRALIA
World Vision Australia is the nation’s biggest humanitarian agency, working with vulnerable children, families and communities to overcome poverty and injustice. The organisation began in Australia in 1966 and is dedicated to transforming lives through development, emergency relief and advocacy work as part of a global partnership operating in more than 90 countries. Through its flagship child sponsorship program, generous Australians have given the gifts of dignity and hope to more than two million children. World Vision serves all people regardless of religion, race, ethnicity, or gender.
ABOUT FIIG SECURITIES LIMITED
FIIG Securities Limited, which is licensed by the Australian Securities & Investments Commission (ASIC), is Australia’s largest specialist fixed-income house.
FIIG has more than $8 billion in assets under advice in its short-term money market, bonds and custody businesses. The company has offices in Sydney, Melbourne, Brisbane and Perth. For more information about FIIG Securities please visit www.fiig.com.au.