Christian Aid launches £20M fund for climate resilience in emerging markets
What's the deal? Christian AidDealroom has a profile for this one. Try Dealroom → has launched an investment vehicle aiming to build £20 million in assets by 2030 to finance locally owned businesses helping communities adapt to climate change. The Christian Aid Resilient Futures Fund (CARFF)Dealroom has a profile for this one. Try Dealroom → is a wholly owned subsidiary with its own board and investment committee.
How it works: CARFF will deploy capital through specialist impact-investment managers, alongside a smaller portfolio of direct investments. Christian Aid has finalised partnerships with impact investors TalantonDealroom has a profile for this one. Try Dealroom → and BlueOrchardDealroom has a profile for this one. Try Dealroom → for the first phase, providing initial capital and operating support itself.
Where the money goes: The fund will concentrate on climate-vulnerable emerging and frontier markets, particularly in sub-Saharan Africa. It will back smaller businesses and financial intermediaries in climate-smart agriculture, renewable energy, clean water, food systems, and local economic resilience.
Why now? The charity is targeting the "missing middle" in development finance: businesses too large for grant programmes but too small or risky for mainstream lenders. Those companies often face short repayment periods, high borrowing costs, and limited collateral.
CARFF aims to provide patient, affordable capital with technical support, letting businesses invest for the long term without relying on grants or expensive short-duration debt. Repayments and returns are to be recycled into future projects rather than distributed, so the same pool can fund several cycles.
What's the endgame? Subject to securing enough funding, Christian Aid aims to reach more than 4,200 small and medium-sized businesses over five years and support the creation of more than 1,800 jobs. Those targets depend on future fundraising and remain ambitions.
The vehicle is currently backed by philanthropic capital. Christian Aid expects later phases to bring in faith-based, social-impact, and other investors, shifting part of the model from donation to repayable investment.
What could go wrong? The direct-lending portfolio requires more internal capability around due diligence, monitoring, and recovery. Enterprises are expected to generate enough value to repay or return capital, a stricter discipline than grant funding.
"Private investment is a critical part of the funding mix," said Patrick Watt, chief executive of Christian Aid.
The signal: Climate adaptation has traditionally attracted less private investment than emissions reduction, since resilience returns from drought, flooding, or food-system disruption are harder to pin to a revenue stream. CARFF is a bet that charitable and impact capital can crowd private money into that gap.
Read more: businessquarter.co.uk
Image credit: HowardLake
