ILF for WASH - Impact-Linked Loans - Aqua for All

Lending solutions with higher impact

Impact-Linked Loans for water and sanitation enterprises

Impact-Linked Loans

Impact-Linked Loans are an innovative financial instrument offered by the Impact-Linked Fund for WASH. These loans enable water and sanitation enterprises to scale and increase their impact by providing “better terms for better impact”.

In essence, Impact-Linked Loans are similar to uncollateralised SME loans. The main difference is that the Impact-Linked Loan’s interest rate and principal repayment depend on the borrower’s achievement of pre-defined impact goals. Hence, the higher the impact achieved, the lower the interest to be paid (impact discount). Next to this, if any pre-agreed impact is achieved over the loan period, part of the principal can be forgiven.


Tailor-made lending solutions that promote impact

Aqua for All designed the Impact-Linked Loans putting impact enterprises at the centre. The specific conditions, including the potential interest rate discount and partial principal reduction, are agreed on with the applicants on a case-by-case basis. Therefore, the Impact-Linked Loan’s terms and metrics differ from borrower to borrower.

Impact-Linked Loans are funded by Aqua for All and will be hosted by the Dutch foundation Impact-Linked Finance Fund (ILFF).

Impact-Linked Loans: Call for applications

Impact enterprises providing water and sanitation solutions can apply for Impact-Linked Loans.

Impact-Linked Fund (ILF) for WASH

The fund supports water and sanitation enterprises access funding under better terms for better impact.

ILF for WASH: Technical assistance

Besides financing, ILF for WASH offers technical assistance to water and sanitation enterprises.

ILF for WASH: Social Impact Incentives (SIINC)

SIINC are non-repayable incentives for water and sanitation for achieving additional impact.

Which enterprises are eligible for an Impact-Linked Loan?

Eligible enterprises must provide solutions to water, sanitation and hygiene challenges in either Eastern or Southern Africa. They can have any legal form but must be at a growth stage of development. This means they should have a defined product offer, a base of paying customers and a business track record of at least 3+ years.

Eligible enterprises must possess financial stability by having achieved break-even/ profitability or are underway to achieve them in the short-term. The enterprises should prove their financial capacity to repay the loan as well as their track record on delivering impact through an established impact measurement system.

For more information, please read the FAQ.


What is the difference between Impact-Linked Loans and Social-Impact Incentives (SIINC)?

There are three main differences between Impact-Linked Loans and SIINC.

  • Impact-Linked Loans require (partial) loan repayment while SIINC provide non-repayable incentives.
  • Impact-Linked Loans are fully disbursed at the beginning of the loan period, whereas SIINC are paid periodically based on verified impact generated.
  • To qualify for receiving SIINC, an impact enterprise must be able to raise repayable investments. This is not required to receive an Impact-Linked Loan.