Catalytic finance

The Catalytic finance practice at MSC draws from our work in social, economic, and financial inclusion over two decades. Fiscal constraints have limited the ability of governments around the world to finance social development goals. Private capital has been slow to bridge this gap, mainly due to a lack of innovative ways to fund investments, unlike the infrastructure sector with reasonably well-established PPP models. The Catalytic finance practice addresses this gap through innovative financing instruments that fund development projects.

Innovative financing arrangements, particularly outcome-based finance, such as development or social impact bonds, can fund ideas and solutions that radically address developmental issues. They offer alternative ways to channel risk capital and create incentives to catalyze a multi-stakeholder partnership, where private sector players work with governments and social service providers. 

We advise private equity houses, institutional investors, and multilateral institutions on impact investing strategy across multiple sectors and geographies. We work alongside governments, financial institutions, philanthropic organizations, and other development partners to align their investment goals to social outcomes.

Our work evolves from our deep understanding of development challenges at the global level. It draws from our solid experience in designing effective interventions in various sectors, such as financial inclusion, health & nutrition, refugees, youth, and agriculture. We believe that a well-designed impact investment project can build templates for scaling up investments in the social sector by funneling the private sector’s interest into this sector.