The non-traded, limited liability company TriLinc Global Impact Fund (TriLinc) has approved another $9.9 million of investments to aid established small and medium sized enterprises (SMEs) in developing countries.
This particular transaction involves three trade finance facilities that will benefit companies in Kenya, South Africa, and Argentina.
TriLinc targets economies that have limited access to affordable capital. By investing in these economies, TriLinc aims to achieve competitive financial gain as well as have a positive impact on the communities where it invests.
On August 29, 2014, TriLinc funded $3,500,000 to an Argentinian dairy-farm cooperative.
The funding is part of a six-month $5,000,000 revolving trade finance facility that is secured by purchase contracts at a 10.33% fixed interest rate. The borrower provides its dairy farmers with financial consulting, environmental training, and technical assistance as well as marketing training for its distribution channels, and technical advice for its suppliers.
In addition, the company has instituted practices that include Good Manufacturing Practices (GMP), Hazard Analysis Critical Control Point (HACCP) and ISO 26000 and follows the UN Global Compact that helps the cooperative abide by 10 universally accepted principles on human rights, anti-corruption, labor, and environment.
TriLinc funded $500,000 at 12.75%, and $900,000 at 13.00% on September 2, 2014 and on September 8, 2014, respectively, to a South African consumer goods distributor. The $1,400,000 trade finance transaction is set to mature on November 27, 2014. Supported by a purchase and repurchase agreement and secured by inventory, the borrower intends to use the investment to increase wages, employment, and employee ownership.
Most recently on September 22, 2014, TriLinc funded a Kenyan cement distributor with a $5,000,000 trade finance transaction. Having a fixed interest rate of 14.75%, the transaction is set to mature on March 17, 2015 and is supported by inventory and receivables, among other liquid assets. The borrower makes use of eco-friendly and energy efficient cement grinding technology to enhance sustainability.
“TriLinc provides financing to growth-stage SMEs in developing economies that both meet our underwriting criteria and demonstrate intention to achieve, track and report on economic development, social and/or environmental impact,” commented Gloria Nelund, CEO of TriLinc. “This approach represents a clear example of how private capital can be deployed for positive change in underserved communities around the globe,” she added.
As of August 31, 2014, TriLinc’s total loan commitment across its investment portfolio was $39,252,000.