Displaced people are not just refugees; they are employees and employers, consumers and suppliers, and business and political leaders.

In our latest publication with the Amahoro Coalition we explore how the private sector can empower refugee communities, developing commercially-viable programs in refugee settings that:

  1. Strengthen access to affordable education
  2. Provide capital to scale refugee-inclusive businesses
  3. Support market access for refugee-owned enterprises

These solutions not only empower refugee communities, but they also create a pool of talent, a thriving market place and enhance partnership opportunities within the private sector.

Read the full publication here


About the Amahoro Coalition 

Amahoro Coalition is an African-led initiative convening business leaders from the region to spearhead the engagement of the private sector in transforming refugee communities. Focusing on education and livelihoods, the Coalition amplifies existing refugee initiatives, stimulates awareness and interest among businesses across the region, generates solutions by facilitating concrete private sector commitments, and serves as a dynamic hub to catalyse policies that encourage companies to integrate refugees within their supply chains.

Innovest Advisory partner KIMS Microfinance, features in Inside Arabia article on microfinance in Somalia.

“Where others see refugees and other migrants as liabilities, a growing group of investors and entrepreneurs see assets: customers, talent and next-gen leaders.​”​​

This phrase sums up a growing movement globally to seek to address the suffering of refugees and migrants through market-based solutions

This important article by leading impact investment news site Impact Alpha charts the rise of impact investment solutions for displaced people.

Innovest Advisory’s partner KIMS Microfinance is featured as well as our strategic partners, the Tent Foundation, the Soros Economic Development Fund and the Alight Fund.

Innovest is now a partner on the Business Fights Poverty Refugee Challenge.

“There is widespread agreement among humanitarian and development experts that an effective refugee response must not only include emergency relief but also long-term development solutions. This shift is reflected in the draft Comprehensive Refugee Response Framework released by UNHCR early this year, which states “refugees should be included in the communities from the very beginning. When refugees gain access to education and labour markets, they can build their skills and lead a productive life, contributing to local economies and fuelling the development of the communities hosting them.”

“The private sector is an essential partner in strengthening refugee economic inclusion and sustainable livelihoods. Finding the right way for companies to collaborate with the array of NGOs, UN agencies, local governments, among others is particularly challenge when it comes to the complex and protracted nature of the situation of many refugees.”

“This Challenge aims to strengthen the foundation for effective partnerships to improve refugees’ wellbeing and livelihood opportunities so refugees can thrive, not just survive. It will add to the great work by Tent Foundation and others who are demonstrating the important role companies play in supporting refugees through employment, delivering education, providing access to goods and services, and investing in entrepreneurs.”

Innovest’s Michelle McMahon has been invited by the UNDP to participate in its Stakeholder Consultation on ‘Expanding Economic Opportunities for Refugees and Host Communities in Egypt, Iraq, Jordan, Lebanon, and Turkey’ on 5-6 March 2018, in Istanbul. Innovest’s partner First Syrian Exporters Group will join the consultation to discuss it’s efforts, working with refugees, in the ready-made garments industry in South-East Turkey.

The First Syrian Exporters Group (FSEG) is a consortium of ten Syrian owned and operated businesses based in the Turkish city of Kahramanmaras. These businesses were originally from Aleppo, Syria, but due to conflict they were forced to relocate to Turkey in 2011 and are now operating as formally registered Turkish businesses. Kahramanmaras is a historic centre for Turkish textiles, and the FSEG consortium has reestablished operations in the fabric production, knitwear and ready-made garments sectors.

FSEG has an annual production capacity of around 6 million items of clothing and generates approximately €20 million euros in exports, targeting markets in the EU, North America and the Arabian Gulf. Starting with a handful of employees in 2011, the FSEG now employs more than 500 staff of which over 70% are Syrian refugees.

Building on its successes, FSEG is seeking to expand its production capacity. This will help create jobs for Syrian refugees, and have a significant impact on the local Turkish economy – the cotton production and transportation sectors – through increased demand.

In addition, FSEG intends to pilot an innovative employee profit share model – Fair Share – which aims to empower disadvantaged Syrian refugees by giving them a profit share from the sales of particular clothing they make.

FSEG has identified opportunities to partner with multinational apparel companies with existing supply chains in Turkey that are willing to become ‘refugee inclusive’.

Solutions at Scale: How social finance is being used to tackle the refugee crisis

Saïd Business School University of Oxford

Join us for a provocative and insightful Social Impact webinar to discuss the challenges of human migration and creative ways Impact Investing and Social Finance are being used to help enable refugees to safely enter the workforce and expand economic opportunities in their new countries.

Oxford Social finance and Impact Investing Programme Director, Gayle Peterson will facilitate this session, and Innovest’s Managing Director Justin Sykes will join to discuss how development know-how can unlock private capital to tackle global challenges including initiatives designed to create durable livelihoods for vulnerable populations – including refugees.

Innovest spoke at the Peace Ventures Conference in Washington DC today – alongside representatives from the UN, the IFC, Mercy Corp and other impact investing experts such as Affinis Labs and Building Markets.. Innovest council Michelle McMahon shared knowledge on market-based solutions to address the global refugee crisis. Examples included innovative solutions focussed on improving refugee and migrant livelihoods in Somalia and South East Turkey.

“Through the use of innovative market-based solutions, vulnerable refugees can become economic actors with improved lives, who benefit the local economy in their host country.​”

– Michelle McMahon​

The Responsible Finance Podcast provides access to the leaders behind innovative approaches to creating positive social impact in responsible finance. In their latest podcast, Justin Sykes, Managing Director of Innovest Advisory, speaks about an Islamic microfinance institution that links impact investors with high-impact Somali micro & small businesses – Kaah International Microfinance Service (KIMS). KIMS delivers Shariah-compliant microfinance across urban areas in Somalia and was recently awarded the Ethical Finance Innovation Challenge & Award (EFICA) by Thomson Reuters and Abu Dhabi Islamic Bank.

KIMS has grown rapidly from its first branch in Somaliland and now covers most of the country, with 11 branches in Somaliland, Puntland and South Central with a cumulative loan portfolio of $8 million that has supported 8,500 micro and small businesses since its launch in 2014. Customers each receive financing of between $1,000 and $10,000, with portfolio-at-risk rates under 2%. This is in line with international standards despite a challenging and changing security situation in the country.
 
The origins of KIMS are also unique, being launched as a social enterprise with support from Kaah Express, a money transfer business based in Dubai which helps the Somali diaspora to support family at home via remittances. Although the remittance business has developed a wide connection between Somalis and the financial sector, the degree of financial inclusion was shallow since few sources of Shariah-compliant financing were available to micro and small businesses before KIMS launched.
 
Prior to KIMS’ launch, it conducted a survey of small and micro businesses and found that fewer than 5% had regular access to formal enterprise financing. The unmet need for finance is at least 250,000 and perhaps upwards of 1 million micro and small businesses, which would represent hundreds of millions of dollars in assets, if the financing was available. Until today, KIMS has been financed through donor financing, cash and in-kind support from Kaah and some zero percent loans from philanthropic sources, but it has an ambitious plan to raise $25 million from Islamic social investors and others who are willing to provide financing to KIMS on Shari’ah compliant terms (equity or profit-and-loss sharing) to support continued growth.
 
Listen to the full interview with Justin Sykes to find out how KIMS has been built to date and how shifting from donor funding to commercial sources can help to expand its social impact.

Innovest’s microfinance client Kaah International Microfinance Institution [KIMS] was recognised by UNHCR in their article and video about the UN Refugee Agency’s support to refugee returnee livilihoods in Somalia. Their publication followed KIMS win of the $100,000 first prize​ at the EFICA Awards last month.

KIMS is Somalia’s only dedicated, privately owned microfinance institution, providing responsible and Shariah compliant financing and micro-savings to Somali micro and small businesses. Since its launch in 2014, they have provided more than $7 million in life-changing financing to over 8,000 Somalis [including refugee returnees, internally displaced people and groups at risk of leaving the country].

As the implementing partner for the microfinance component of the UNHCR funded project, KIMS was praised for the impact of its programme in giving Somali returnees a chance to rebuild their lives.

Sanabel, the Arab Microfinance network, holds its annual meeting in Beirut 7-8 November 2017. Innovest Advisory will be supporting its partner KIMS Microfinance present on a panel on microfinance and refugee livelihoods as well as engaging with a range of microfinance institutions in the Levant region to determine opportunities to develop lending programmes for refugees.