THE Embassy of Switzerland has launched ‘Daraja Impact Fund’ worth 26.4bn/- as part of its Innovation for Social Change project to support the growth of micro, small and medium-sized and impact-driven enterprises (MSMEs).
The fund is also expected to improve livelihoods of Tanzanians, particularly youths and women.
The fund supports Tanzanian enterprises by providing investment capital and technical assistance, aiming to foster growth, resilience and financial sustainability. This in turn, promotes economic inclusion and empowers underprivileged communities.
The Daraja Impact Fund will be implemented and managed by Small Enterprise Assistance Funds (SEAF) in partnership with Alpha Mundi Foundation (AMF).
Over the past two decades, Tanzania has experienced a growing Micro, Small, and Medium Enterprises (MSMEs) sector.
However, despite their significant economic contributions, MSMEs continue to face numerous challenges that impede their development, such as inadequate access to capital and markets, regulatory constraints, underdeveloped infrastructure, limited innovation, and insufficient human capital development, all of which affect their ability to scale.
In his remarks during the launching ceremony held in Dar es Salaam on Wednesday, the Ambassador of Switzerland to Tanzania Mr Didier Chassot said through support to improve and contribute to the overall favourable environment, the country is convinced to see more Tanzanian entrepreneurs generating employment and positive impacts within their communities.
“Switzerland commits to support the Daraja Impact Fund for a five years period, to a total of CHF 10,000,000 (about 26.4bn/-) using innovative Swiss-pioneered impact-linked financial instruments. Together with our partners, Small Enterprises Assistance Funds (SEAF) and The Alpha Mundi Foundation, Switzerland’s funds are thus used to attract commercial capital to support businesses in Tanzania.” said Ambassador Chassot.
The catalytic Daraja Impact Fund will ensure that a solid pipeline of social enterprises receives Technical Assistance as well as the financing needed in order to scale their business model that is showing dedicated social and gender-responsive characteristics.
On her side, Executive Director of Alphamundi Foundation, Ms Lade Araba said they are thrilled to manage the investment vehicle for the Daraja Impact Fund to support SMEs that show high potential for generating positive impact for women and youths, while delivering strong business performance.
She said that they are eagerly awaiting the positive externalities that they will create in their respective communities in Tanzania. Gender-lens investing for climate that leverages blended finance and impact-linked finance instruments is an important lever to create an inclusive and green future, with greater prosperity for all.
“We are thrilled to manage the investment vehicle for the Daraja Impact Fund to support SMEs that show high potential for generating positive impact for women and youths, while delivering strong business performance. AMF is therefore pleased to partner with SEAF to implement this project funded by the Embassy of Switzerland in Tanzania,” she said.
