World’s largest gender-lens fund starts operating with new investment strategy to help address the USD1.7 trillion gender gap

June 2024: The Global Gender-Smart Fund (GGSF), the world’s largest gender-lens investment fund, has implemented a new strategy focused on gender-smart financing. This strategy aims to address the USD 1.7 trillion gender gap by providing responsible financial services to underserved women, women-owned, and women-led businesses in developing markets. It seeks to improve livelihoods, promote women’s leadership, and enhance gender balance within financial institutions.

Building on a successful 15-year track record, the Microfinance Enhancement Facility (MEF), initially founded in 2009, was transformed into the Global Gender-Smart Fund (GGSF) on 1 January 2024, introducing a new gender-focused strategy as well as a new structure.

Since MEF’s inception – originally intended as an emergency response vehicle to the global financial crisis – the Fund evolved and successfully provided liquidity to the microfinance sector across the developing world, focusing on low-income households and micro-entrepreneurs with average end-borrower loan sizes of USD1,700 and high outreach among women and rural populations. Over the past 15 years, the Fund has supported over 320 financial institutions across 65 countries, with an average loan size of USD3.5 million, reaching USD3 billion invested by end of 2023.

As the Fund transitions into its new mandate, Ruurd Brouwer, Chairman of the Board, explained: “The Fund’s founding shareholders, the Federal German Ministry for Economic and Cooperation and Development (BMZ), the German development bank KfW (both as trusted for BMZ, but also investing its own funding), the International Finance Corporation (IFC), and the Development Bank of Austria (OeEB), have been instrumental in defining the Fund’s new impact focus. The Board is looking forward to providing oversight and support to the world’s largest gender-lens investment fund, addressing the USD1.7 trillion gender gap through financial inclusion.”

“Since the Fund’s inception, the microfinance industry has matured and financial inclusion efforts have shifted,” said Tomasz Telma, Director & Global Head of the Financial Institutions Group at IFC. “The Fund’s new strategy to focus on gender-smart financing and to expand focus beyond microfinance to small enterprises as well is adapting to the current environment and also aligns with IFC’s priorities, including the focus on gender finance, which greatly supported IFC’s renewed commitment.”

The new strategy focuses on strengthening the provision of gender-smart and responsible financial services concentrating on underserved women as well as women-owned and women-led businesses in developing markets, thereby seeking to improve livelihoods, increase gender balance and outreach, and promote women’s leadership. Additionally, the Fund aims to improve gender equality at the level of the financial institutions themselves: On the one hand, by improving the gender-balance at senior level, on the other hand by improving working conditions for women. In this dual approach, the Fund aims to build on the 2X criteria, a global baseline standard for gender finance ( and seek 2X Certification for its investees.

“As one of the initial shareholders, we have seen the Fund grow and adapt to the realities of the market, and the clear intention and additionality of this gender-smart strategy naturally led to OeEB renewing its commitment to continue supporting the provision of impactful financing in regions where it is most needed”, said Sabine Gaber, Member of the Executive Board of OeEB.

In order to support the Fund’s new mission, a technical assistance facility has been set up, with initial funding provided by the fund’s largest shareholder, BMZ. Such a facility will foster engagements with partner financial institutions on critical areas of improvement that are identified during due diligence, thus supporting financial institutions in designing and implementing a concrete gender-smart action plan.

Dirk Meyer, Head of Directorate-General Multilateral Development Policy; Transformation; Climate at BMZ indicated: “Germany remains a strong supporter of impact investment. The revised investment strategy of the GGSF sends a signal to the financial markets that there is the willingness and the opportunities to tackle the funding gap for women and female entrepreneurs in emerging markets and developing economies. The technical assistance facility is an important step to support partner financial institutions in strengthening their gender lens.”

Stephanie Lindemann-Kohrs, Global Head of Equity and Funds at KfW Development Bank emphasized: “We are very proud of the ambitious strategy that is being implemented with a very clear purpose: Building on a strong blended finance structure to tackle the funding gap faced by women in developing markets through innovative financing solutions”.

The Fund also attracted strong private sector interest, in particular from M&G Investments which has provided USD120 million in senior notes to support the growth of the portfolio.

Eoin O’Shaughnessy, Co-Head of Structured Credit Research at M&G Investments, says: “We are proud to be one of the largest investors in the Global Gender-Smart Fund – a unique and innovative vehicle that combines financial returns with social impact. By investing in financial institutions that empower women and promote financial inclusion, we are supporting the economic development and resilience of some of the world’s poorest communities. This investment also demonstrates how different parts of M&G can work together to provide our clients with access to a diverse and attractive range of opportunities across different asset classes and geographies.”

The new strategy and structure became effective as GGSF on 1 January 2024. Innpact Fund Management, the Alternative Investment Fund Manager (AIFM) in Luxembourg dedicated to impact finance, serves as fund manager and global portfolio manager. Innpact Fund Management is a 100% subsidiary of Innpact S.A. The sourcing, relationship management, and investment decision is conducted by three portfolio managers, Incofin, responsAbility and Triple Jump, all three leading impact investing specialists with extensive global experience. The technical assistance is provided through a streamlined process by a global consortium formed by NIRAS A/S and Women’s World Banking, both gender specialists with extensive experience in the implementation of projects supporting gender equality.

Patrick Goodman, Founding Partner at Innpact, reiterated: “The great collaboration of the different parties in the Fund – shareholders, investors, portfolio managers, service providers – is an impressive achievement and it is inspiring to see such great industry leaders coming together to serve a common impactful objective. We expect this evolution of the Fund will be transformational in addressing gender issues through financial inclusion thanks to the breadth of countries and financial institutions the fund invests in. The strong blended finance structure of the Fund, preference for local currency financing, and support from committed DFIs and donors, will enable additional private sector financing, allowing the Fund to grow and increase its impact on women in developing markets.”

Noémie Renier, Head of Debt at Incofin, said: “The Global Gender-Smart Fund is one of the most exciting projects we are working on. As portfolio managers, we are committed to improving access to essential financial services for women, supporting women entrepreneurs, and enhancing gender balance in the companies we invest in. Each investment is guided by a gender action plan with measurable targets, ensuring a substantial impact on closing the $1.7 trillion gender gap.”

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