Aqua for All uses Impact-Linked Finance to incentivise additional impact and helps water and sanitation enterprises reach harder-to-serve communities.
This strategy builds on the successes and lessons of the ILF for WASH programme in partnership with Roots of Impact.
Aqua for All uses Impact-Linked Finance to incentivise additional impact and helps water and sanitation enterprises reach harder-to-serve communities.
This strategy builds on the successes and lessons of the ILF for WASH programme in partnership with Roots of Impact.
THE CHALLENGE
What is ILF?
By linking finance to measurable outcomes, Impact-Linked Finance (ILF) helps enterprises attract private investment, scale sustainably and better reach underserved communities.
The Impact-Linked Fund for Water, Sanitation and Hygiene (ILF for WASH) by Aqua for All in partnership with Roots of Impact is an innovative finance programme that provides water and sanitation enterprises in Africa and Asia with catalytic finance and next-level technical assistance. As the programme is coming to an end, successes and important lessons shape Aqua for All’s future ILF strategy in WASH.
people worldwide still lack access to safely managed drinking water. In the least developed countries, people are twice as likely to lack access to basic water and sanitation.
If the need is so urgent, why is scaling WASH solutions still so hard?
➜ LAST-MILE REACHED
WASH enterprises are often the ones reaching communities that traditional service providers overlook.
➜ TOUGH ECONOMICS
Serving low-income households means working with thin margins, complex contexts, and limited regulatory support.
➜ MISSING CAPITAL
Without the right finance and impact data, many enterprises struggle to move beyond early-stages.
ILF for WASH aligns so well with what we strive to do at Jibu but couldn’t do due to the extra risk… ILF is very system-changing as it integrates behavioural change into our organisation. The design process was very participatory and flexible.
– Tosca Terra, former Head of Impact and Partnerships, Jibu
THE SOLUTION
We don’t fund inputs.
We reward additional impact.
How?
Impact-Linked Finance (ILF) ties capital directly to verified social outcomes. When an enterprise creates more measurable, positive impact, it receives better financing conditions. The stakeholder interests are aligned — investors, enterprises, and the communities served pull in the same direction.
Catalytic finance
Impact-Linked Finance improves profitability and mobilizes private investment.
Technical assistance
A ranges from impact measurement and ILF readiness training to tailored enterprise support.
Learning & community
Extensive evidence and lessons learned are shared with other funders and the wider water and sanitation sector.
What the entrepreneurs say
INSTRUMENTS
One size doesn't fit
every enterprise.
SIINC
Social Impact Incentives (SIINC): time-limited payments for achieving additional impact. Repayable investment needs to be raised in parallel to support financial sustainability.
Ticket size range
EUR 150,000 – 400,000
ILL
Impact-Linked Loans (ILL): the more impact achieved, the lower the cost of capital. Higher outcomes can even lead to a partial forgiveness of the loan principal.
Average ticket size
EUR 200,000
SAFI
Simple Agreement for Future Impact (SAFI): flexible, non-dilutive growth capital. Revenue-based repayments are capped and fall as impact increases.
Average ticket size
EUR 200,000
FACTS & FIGURES
Catalytic capital,
multiplied.
Average financial leverage
Every €1 of incentives mobilised €7 in additional external investment.
FACTS & FIGURES
Catalytic capital,
multiplied.
Average financial leverage
Every €1 of incentives mobilised €7 in additional external investment.
Underserved people reached
Individuals benefiting from WASH products and services delivered by 6 funded enterprises since 2020, including 60,274 attributable to ILF.
Underserved customers served
Underserved customers reached directly by 6 funded enterprises, including 24,284 additional customers attributable to ILF.
IMPACT STORIES
Leaving no one behind:
What changes
when impact pays off
AQUA CLARA KENYA · SIINC · KENYA
Staying mission-true under commercial pressure
Providing household and community water filters that cut exposure to waterborne diseases. Despite pressure to go commercial, ACK kept its focus on low-income households: filter-washing rose from 63% to 93%, and 11 new school-based hubs reached 8,600 pupils.
“Impact-Linked Finance helps us go where we really want to go, but sometimes don't manage to go.”
BIDHAA SASA · IMPACT-LINKED LOAN · KENYA
A loan that rewards progress, not just returns.
Supporting female group leaders who sell household goods that boost water security in rural areas. The impact-linked loan drove 186% growth in water-tank sales, while training end customers to keep tanks clean.
“Investors usually want the full triple bottom line but aren't ready to sacrifice any returns. Their motto is ‘no trade-offs, please'.”
JIBU · SIINC · UGANDA
A franchise model that reaches deeper.
Local entrepreneurs run ultra-filtration franchises producing safe, bottled drinking water. ILF rewarded reaching and keeping low-income customers: ~3,200 reached with an 80% retention rate, plus a fairer gender balance, with female franchisees rising to 45%.
“What I like about Impact-Linked Finance most is the flexibility… the interest rate and the incentives are linked and aligned. Usually it's the exact opposite.”
TAP EFFECT · SOCIAL IMPACT INCENTIVES (SIINC) · CAMBODIA
Payments that reward reaching the last mile.
Supporting rural piped water utilities that connect underserved households to clean water in Cambodia. SIINC rewards Tap Effect for faster household connections, bathroom hookups, and reaching low-income communities.
"The SIINC contract also gave a good signal to investors, as it improves our profit and loss statement and profitability."
LESSONS
Five years of
evidence, distilled.
1 – No one size fits all
Different enterprises need different instruments depending on investment readiness, funding needs and ability to measure impact.
2 – Flexibility is essential
Metrics and targets must adapt as business models and markets shift, so external shocks don’t penalise good work.
3 – Data gaps are barriers
Many enterprises track outputs, not outcomes. ILF contributes to building stronger impact-measurement systems alongside finance.
4 – Autonomy matters
ILF works best when enterprises hold full control over customers targeting and impact strategy.
“ILF is a well-thought-through approach that rewards your progress, is patient, and gives you the flexibility to scale an impactful solution.”
– Antony Kamotho, Managing Director, Purefresh
“ILF is a well-thought-through approach that rewards your progress, is patient, and gives you the flexibility to scale an impactful solution.”
– Antony Kamotho, Managing Director, Purefresh
OUTLOOK
What's Next:
Scaling Impact-Linked Finance in WASH
From evidence to expansion
A New Chapter: CIIF
Aqua for All is expanding its strategy with the Catalysing Impact with Innovative Finance programme (CIIF), co-funded by SDC and DGIS.
More Impact in WASH
Impact-Linked Finance and other innovative finance approaches are used to reach more enterprises and harder-to-serve communities.
Partner With Us
If you want to use Impact-Linked Finance and other innovative finance approaches for more impact in WASH, let’s partner up!
Photo credits: Aqua for All and partner entrepreneurs.
Content: Roots of Impact & Aqua for All
Design: Roots of Impact | Aqua for All | Pioneers Post
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