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In brief: Lightrock explains its financial inclusion mission for Africa

LGT’s impact offshoot Lightrock creates ‘financial empowerment’ and ‘provides liquidity’ with latest deal, says Lightrock partner Shakir Merali.

Lightrock, the impact investing firm backed by LGT Group, is seeking to create “financial empowerment” in Africa by providing liquidity to “economically generative businesses”. Lightrock’s $900 million debut fund led a $18.5 million funding round in 4G Capital, a Nairobi-headquartered lender for micro and SME businesses in Africa, the firm announced today.

“Often used to justify the backing of many African companies, ‘financial inclusion’ has not always translated into positive outcomes for customers,” Lightrock partner Shakir Merali, who is joining 4G’s board, said in a statement. “What is needed on the continent is investment capital to back companies with the mission of financial empowerment. 4G Capital provides liquidity to the vast market of economically generative businesses that dot the landscape of Africa. The systemic value of improving lives is compounded, as productive employment leads to economic outcomes and better education and health outcomes in the communities these businesses serve.”

The deal is hot on the heels of Lightrock’s investment last month in Selina, a provider of home equity credit lines in the UK.