In partnership with Kashf Foundation, a not-for-profit and licensed microfinance institution, InfraZamin Pakistan, a licensed NBFI and credit guarantee provider announced the closing of South Asia’s and Pakistan’s inaugural ‘Gender Bond’ on Thursday, revolutionizing financial empowerment and inclusion for women.
The Bond, has received a prestigious long-term AAA rating from PACRA. This bond represents a significant step forward in Pakistan’s capital market. Moroever, the Rs. 2.5 billion Gender Bond, was issued earlier this year to capital market investors. It has been fully subscribed.
Kashf Foundation issued the Bond, which was fully credit wrapped by InfraZamin Pakistan. It has been protecting 100 percent of the principle as well as two interest installments. Furthermore, the Gender Bond has been subscribed to by over 30 institutional investors, demonstrating considerable crowding in of private sector investment.
In addition, this significant involvement by non-banking institutional investors, led by the Bond’s joint lead arrangers. The Gender Bond’s leaders included, Arif Habib Limited, Bank of Punjab, Bank Alfalah, and Standard Chartered Bank.
This is a promising indicator for the development of Pakistan’s capital market. The instrument will be listed on the PSX. Furthermore, the instrument will be priced at 3-month Kibor + 1.50pc spread for a three-year tenor.
The Gender Bond fully supports the Securities and Exchange Commission of Pakistan’s (SECP) Guidelines for Gender Bond Issuance. They are based on the UN Sustainable Development Goals and UN Women’s principles for women’s empowerment.
Recent SECP modifications have further assisted risk mitigation by granting NBFCs an 85% exemption for exposures against InfraZamin’s guarantees. As well as other areas of support for mutual funds.
The bond proceeds are projected to strengthen Kashf’s financial sheet. Furthermore, it is also projected to delivering much-needed commercial finance to women from disadvantaged backgrounds.
Kashf’s microfinance lending portfolio will be expanded to finance the development of micro-infrastructure for around 30,000 women from low-income and rural households.
This will allow people to pursue their entrepreneurial dreams, repair flood-damaged houses. In addition, it will also help to grow schools and small businesses. Such lending will assist women in achieving financial independence and developing financial capacity. As well as contributing to Pakistan’s economic growth and productivity.
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