Fairventures Social Forestry, a developer of scalable agroforestry-based climate solutions, has closed an impact loan. The loan is provided by UBS Optimus Foundation and will be used to finance the further development of the 3,000 hectares showcase project of Fairventures Social Forestry in Central Kalimantan (Borneo, Indonesia).
The Fairventures Social Forestry approach is centred around reforestation of degraded land and the empowerment of local communities, taking into account equal employment opportunities for women in particular. The long-term loan has an interest rate linked to impact metrics such as carbon sequestration, local employment and gender equality. The repayment profile of the loan reflects this long-term business model of Fairventures Social Forestry. The Impact Loan resulted from an introduction of the parties by Silverstrand Capital. USAID Green Invest Asia supported Fairventures Social Forestry with structuring the loan.
“We are delighted to have closed the impact loan with UBS Optimus Foundation. This is a key milestone in diversifying our funding sources for our showcase project in Central Kalimantan. We highly value the entrepreneurial focus on impact and the long-term mindset of UBS Optimus Foundation,” says Robert Bürmann, CEO of Fairventures Social Forestry GmbH.
“Besides the ongoing work on this showcase project in Borneo,” Bürmann continues, “we are focused on adding reforestation projects across Indonesia to our portfolio. We see huge potential for implementing our approach at scale and remain strongly committed to our target of sustainably managing 100,000 hectares of land, with a climate potential of at least 6 million tonnes of CO2 equivalent, within the next ten years,” he says.
“We are excited to fund Fairventures Social Forestry’s pilot in Central Kalimantan. Combining the landscape approach, which maximizes social and environmental impact on each individual land plot with a viable business model, is well aligned with UBS Optimus Foundation’s strategic focus on supporting Nature-based Solutions. We are confident that our support will catalyse more private capital towards Nature-based Solutions and help achieving the UN’s Sustainable Development Goal 15, Life on Land,” says UBS Optimus Foundation Head of Social Finance, Dhun Davar.
Good Energies Foundation, a seed funder for the showcase project, is excited about the project’s development progress and welcomes UBS Optimus Foundation as a project lender. “With this new investment, Fairventures Social Forestry is demonstrating that blended finance structures can help catalyse much needed financing for restoration and Nature-based Solutions more generally. This is vital to restoring key ecosystems in many tropical forest regions, including Central Kalimantan,“ says Good Energies Foundation Programme Manager, Mireille Perrin.
