Last updated January 2024
To help fund sustainability projects and help get closer to net-zero carbon emissions by 2050, the Monetary Authority of Singapore (MAS) is putting SGD 5 Million seed capital into the Asia Climate Solutions Design Grant. This announcement was made during the inaugural Transition Finance Towards Net Zero (TFNZ) conference on October 4, 2022.
The TFNZ conference focused on the theme of scaling “blended finance”, which involves the use of concessional and catalytic capital to draw in private capital at commercial rates for financing projects with sustainable outcomes.
What is Blended Finance?
Blended finance, as defined by the Organisation for Economic Co-operation and Development (OECD), refers to the strategic use of development finance to mobilize additional resources for sustainable development in developing countries. This approach attracts private capital to support sustainability projects while offering financial returns to investors. Although its primary focus lies on developing countries, Singapore is actively embracing blended finance models to back regional sustainability initiatives, such as the electric vehicle project in Vietnam.
By leveraging blended finance, developing countries can gain access to the necessary resources and tools to build sustainable solutions for contemporary challenges. Moreover, it facilitates the accumulation of funds for their government’s Official Development Assistance (ODA) and supports the ongoing implementation of the Paris Agreement.
For Singaporean investors and financial institutions, blended finance presents exciting opportunities for diversification, access to new markets, and the chance to make positive social and environmental contributions within the region. This aligns perfectly with Singapore’s Green Plan 2030 goals.
In December 2023, Singapore launched the FAST-P (Financing Asia’s Transition Partnership) initiative. This groundbreaking platform combines public and private financing to mobilise up to US$5 billion for climate action in Asia. Alongside it, the Energy Transition Acceleration Finance Partnership (ETAFP) was also established. This influential collaboration involves the Asian Development Bank (ADB), the Global Energy Alliance for People and Planet (GEAPP), and the Monetary Authority of Singapore (MAS). Together, they aim to mobilise up to US$5 billion to de-risk and support Asia’s decarbonization efforts. By uniting stakeholders from diverse sectors, including public, private, and philanthropic, this partnership seeks to bridge the financing gap through the integration of blended finance, fostering economic growth and climate resilience throughout Asia.
Asia Climate Solutions Design Grant
The Asia Climate Solutions (ACS) Design Grant aims to fund the design and launch of innovative blended finance solutions that address the climate finance gap in critical climate mitigation and adaptation sectors in Asia, such as clean energy transition, sustainable cities, and infrastructure.
The grant, which targets organizations aiming to develop Asian markets, previously accepted Concept Notes from prospective applicants until February 12, 2024.
The grant hopes to fund various studies, including:
- Early-stage climate adaptation and mitigation technology.
- Clean energy access.
- Sustainable transport.
- Sustainable agriculture.
- Other nature-based solutions.
The grant was organised by Convergence Blended Finance and supported by anchor donors including the Monetary Authority of Singapore, the Department of Foreign Affairs and Trade Australia, Olayan Group, and UBS Optimus Foundation. The grant has secured its first round of funding commitments from the MAS and other anchor donors, with ambitions to grow the grant funding program beyond S$5 million.
Lanturn Fund Services
At Lanturn, we provide industry-leading fund formation and administration services to unlock the full potential of your venture capital. Our experienced team guides you through every step of the process – from securing MAS licenses and incorporation to liquidation. We have supported a diverse range of funds including venture capital, venture debt, and private equity for both local and international clients.
Our fund formation services offer comprehensive support so you have an experienced partner with you throughout the entire journey. We bring transparency and efficiency to fund management in Singapore through leading-edge technology and robust compliance like KYC and AML checks. Lanturn also offers fund administration services, where you get personalised guidance from our team of experts. We customise our services to help your fund scale and thrive.
Are you a fund manager or investor who needs more information or assistance about the SGD 5M Asia Climate Solutions Design Grant or any other investment grants from the Singapore government? Talk to us at Lanturn.
