Sub-Saharan Africa Investment Pipeline Development: WASH Microfinance

Type: 
RFP
Employer: 
WaterEquity
Location of Job: 
Remote
Posted: 
06 May 2019
Closing: 
24 May 2019
Document TitleSize
PDF icon Original TOR51.5 KB
About the organization: 

WaterEquity is the first-ever impact investment manager dedicated to mobilizing private sector investments to accelerate universal access to water and sanitation in emerging and frontier markets. Access to safe and affordable water, sanitation and hygiene (WASH) infrastructure and services is essential to quality of life. However, globally, 2.4 billion people do not have access to improved sanitation facilities and 663 million do not have access to safe drinking water. WaterEquity strives to enable the achievement of UN Sustainable Development Goal 6 (SDG 6): universal and equitable access to safe and affordable drinking water and adequate and equitable sanitation and hygiene for all by 2030.

The World Bank estimates that $1.7 trillion is required to meet SDG 6, and public finance by itself will not be enough, meaning private investments and innovative financing approaches like WASH microfinance are needed. Fortunately, financial institutions in many countries provide retail loan products which are used by households to finance the construction of household water and sanitation facilities. This represents a large market for impact investment, and WaterEquity has developed an international practice mobilizing capital to this sector. In addition, WaterEquity’s sister organization, Water.org, provides capacity building services to financial institutions to expand their delivery of retail financial services for water and sanitation.   

In 2015, WaterEquity launched its inaugural investment fund, an $11 million fund providing loan capital to high-performing microfinance institutions in India to scale their water and sanitation loan portfolios. In April 2017, WaterEquity went to market with a $50 million fund to invest financial institutions and water and sanitation enterprises in India, Indonesia, Cambodia, and the Philippines. This fund will reach 4.6 million people with safe water or sanitation over its seven-year term. The fund was oversubscribed and executed its third and final close in March 2019. As of today, the fund has already deployed more than 50 percent of capital under management.

    About the Job: 

    WaterEquity is seeking to engage a consultant to conduct initial pipeline development activities in Sub-Saharan Africa. The engagement provides strong opportunity for follow-on assignments including potential to transition to a full-time role as the WaterEquity investment lead for the region.

    • Narrow long-list pipeline and identify high potential investment candidates in target countries: Ghana, Ivory Coast, Kenya, Nigeria, Senegal, Tanzania, Uganda and Zambia.
    • Build direct contact with candidates and assess funding requirements and level of interest in off-shore debt funding.
    • Begin screening high-prospect candidates for potential investment starting from 2020 onwards.

    The pipeline development will identify the potential opportunities for investing in retail finance for water and sanitation in the following target countries: Ghana, Ivory Coast, Kenya, Nigeria, Senegal, Tanzania, Uganda and Zambia. Additional countries could be considered based on response from the initial target countries.

    The overall objective of the consultancy is to:

    • Introduce WaterEquity to financial institutions that provide retail financial services to low and middle-income households (microfinance institutions, banks, cooperatives, housing finance companies, etc.)  and gather market intelligence through discussions with those financial institutions. Assess and estimate their capital requirements for WASH & home improvement financing related activities.
    • Create database of private debt investment opportunities in qualified financial institutions (minimum GLP > $10 million, and either an existing portfolio of housing or water and sanitation lending or demonstrated interest in launching such a product).
    • Summarize all findings and present recommendations for investment strategy for capital allocation by country, asset class, rate of return, type of financial institution (MFIs, Banks, Cooperatives, HFCs, etc.) based on research findings.

    Scope of Work:

    • Using relevant sector knowledge and WaterEquity candidate long-list, identify qualified financial institutions in target countries with high potential for investment. In countries where Water.org operates (Kenya), coordinate with local Water.org staff to ensure high potential Water.org partners are considered.
    • Present to WaterEquity list of targeted financial institutions to be contacted and rationale for recommended targets.
    • Undertake training with WaterEquity prior to contacting target financial institutions: e.g. how to present WaterEquity, information to be collected from target financial institutions, commonly asked questions and answers.
    • Establish contact with target financial institutions and conduct telephonic interviews to collect responses to 10 (estimate) key questions to confirm potential for investment, estimated amount, currency, pricing, tenor, etc.
    • Identify the following candidates which express interest to borrow at (or near to) market rate terms:
      1. At least five candidates with GLP>$75 million.
      2. At least 15 candidates with GLP $10-$75 million.
    • Add collected information to WaterEquity’s existing candidate long-list and present results to WaterEquity with brief presentation of recommended strategy for investing in financial institutions in the target countries.

    There is high potential for follow-on assignments (e.g. investment screening of top candidates) and potential transition to a full-time role as WaterEquity investment lead for the region.

    Qualifications:

    • Existing professional network of contacts within the microfinance sector in the target countries.
    • Proven experience in undertaking similar/related assignments in the financial sector.
    • Significant work experience in senior position in a microfinance institution, microfinance investment fund, bank lending to the microfinance sector, or microfinance ratings agency.
    • Experience working with impact investors/development finance institutions and familiarity with their policies and procedures.
    • Experience with different financial instruments across multiple asset classes (cross-border investment experience preferred).
    • Fluency in English; Proficiency in French preferred.
    • Experience in the housing, water and sanitation or infrastructure sector preferred.

    See deliverables and timeline in the attached TOR.

    How to Apply: 

    Interested candidates are requested to send the below documents to [email protected] before noon EST on 24 May 2019.

    • Cover letter demonstrating an understanding of the context, background and objectives of the project;
    • CV outlining respective capabilities and experience relevant to the project;
    • Fixed cost financial proposal indicating compensation terms including daily rate and number of days.