Public Private Development Partnership: Social Entrepreneurship Catalytic Impact Financing for Latin America and the Caribbean (LAC-IMPACT)

Social entrepreneurs (SE) find innovative, effective and efficient solutions to social problems with a private sector, entrepreneurial approach. ODA funds are scarce and need to be used with leverage. This intervention will leverage social enterprises efforts, impact investors’ capital and local government funds for poverty reduction and improved livelihood of low income households.

Country/region Topic Period Budget
Central America
Latin America
Employment & economic development
Vocational training
Business support & economic inclusion
Financial policy
SME development
Vocational training
Rural development
01.11.2015 - 31.12.2027
CHF  6’340’000

By providing goods and services to low-income people, social enterprises create huge benefits to clients and society. But market prices may not always cover fully the costs and stay appropriate and accessible for low-income clients (e.g. in education, when benefits are far away in the future or when households do not have liquidity or access to finance, etc.). This may hurt profitability of social enterprises, their access to capital and their growth to scale. On the other hand, there is an exponentially growing market of impact investors interested in enterprises aiming at financial and social return. This programme suggests innovative, catalytic models to use development finance in bridging the gap.

The programme creates synergies between the Interamerican Development Bank (IDB) and SDC with pay-for-outcome funds administered by IDB/MIF.


Overall objective (impact) is poverty reduction and improved livelihood of low-income households, in particular female headed ones, in LAC.

Target groups

Low income households in LAC, in particular female headed.

Medium-term outcomes

The three main outcomes (change of the performance of the system) are

  1. Up to 4 SE (per USD 1 Mio. inside the LAC-IMPACT facility administered by IDB/MIF) can scale their operations and provide products and services to 4’000 low-income clients, who shall have net additional incomes (or a corresponding value in livelihood improvement) of a total of USD 3 Mio. during several years.
    Special attention is given to gender inequalities.
  2. The SIINC model proves attractive to impact investors and more deals will follow the model. At least USD 3 Mio. capital are invested into the 4 SE (non-SDC funds) and more capital via other Social Impact Incentives (SIINC)-inspired programs (copy cats).
  3. The approach is adopted and utilized by further funders, additional investment of USD 4 Mio. into the IDB/MIF facility and multiplying the leverage from outcome 2 further.

Expected results:  

  1. 4 SE receive appropriate support and investment (USD 3 Mio.)
  2. Social impact incentives (SIINC) based payments ensure financial viability in the short term and long term sustainable solution are set up.
  3. Robust and convincing social impact data made available (gender disaggregated).
  4. Impact investment industry and philanthropic bodies incl. donors inspired, and strong double bottom-line impact investors able to reassess SEs investability explicitly factoring in social contribution.

Results from previous phases:  

First phase, single phase multi-bi pool project

(Results of collaboration with Social Entrepreneurs in Latin America in project 7F-08735.01 are promising, with important outreach numbers (hundreds of thousands) after 1,5 years, good impact and good progress of project.)

Directorate/federal office responsible SDC
Credit area Development cooperation
Project partners Contract partner
International Financial Institution (IFI)
Private sector
  • Interamerican Development Bank (other)
  • Foreign private sector North

Coordination with other projects and actors

IDB/MIF Social Entrepreneurship Program (SEP)
7F-08735.01 - Public Private Development Partnership: Promoting Social Entrepreneurship in Latin America

Budget Current phase Swiss budget CHF    6’340’000 Swiss disbursement to date CHF    5’765’685
Project phases Phase 1 01.11.2015 - 31.12.2027   (Current phase)