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Exchange summary
The BwB Talk Series is where we bring innovative leaders in impact, finance, and the environment to speak with our network around the world. The BwB Talk Series helps generate new ideas for our network by bringing experts to share their deep knowledge of sustainability topics.
The latest episode of the BwB’s Talk Series met us with @Louise Wilson, Co-founder & Joint Managing Director at Abundance, a crowdfunding platform dedicated to place-based borrowing for local authorities’ green projects.
The conversation started off with Louise’s introduction to the Abundance team and its focus on sustainable finance. Abundance is the 1st regulated crowdfunding platform in the world. The platform was launched 12 years ago in times when crowdfunding was not a recognised term, certainly not from an investment perspective.
Louise discussed the benefits of place-based borrowing for climate action and the role of citizen-based financing for sovereign debt in emerging markets.
“Abundance offers placed-based borrowing for climate action. Climate action should also include addressing biodiversity loss and the nature emergency as well as delivering a just transition. The advantages of working with a place-based lens is that you can capture all of those, and certainly we see the three objectives or challenges as being completely interlinked. There is no point fixing one if you don't address the others.”
In terms of crowdfunding, the platform is focused on raising debt and equity for businesses and projects dedicated to installing sustainable infrastructure, and more recently, for councils.
“Although it currently operates in a UK-focused context, the model is highly replicable so we would love to see it used in other jurisdictions. We would be more than delighted to help regulators, lawmakers, financial institutions and other markets,” highlighted Louise.
Question Time
One of the most engaging segments of our Talk Series is the Q&A session between our speaker and BwB. This talk’s Q&A segment was filled with insightful moments, a few of which we have captured below.
Louise explained the council product and its impact on local communities.
BwB’s CEO, Rupesh Madlani, wanted to find out about exportation of the product across other jurisdictions, for example, across Europe.
Louise highlighted there are two factors to be considered with the first being the regulatory and legal frameworks and the second, the cultural attitudes to money in the context of lending and investing.
“Most European countries have regulatory frameworks that incorporate peer to peer lending and crowdfunding, so in principle this makes it possible for potential expansion. Cultural attitudes to lending and investing can vary significantly, with crudely a Northern Europe - Southern Europe grouping.”, commented Louise.
Christine Zhou, BwB Executive Director, Global Head Built Environment & Circular Economy Finance, wanted to find out if projects considered for funding need to be fully-developed or does the platform also accept more innovative business models.
Louise explained that once a council has gone through its annual budgeting process, it then sets aside capital for a list of projects - a process which Abundance is not involved in.
“We just become a way for them to finance it. We offer councils an efficient alternative to asking for funding from central government or their other established sources. Councils know that getting residents engaged in understanding how they operate, let alone doing their bit in the transition to Net Zero. But Abundance offers a solution to help bridge those awareness and engagement gaps.”
Further questions focused on the marketing of the loans on behalf of councils, the difference between bonds and loans and the monitoring process, and sustainability-linked instruments.
BwB saw opportunities for cooperation in the context of its NetZeroCities projects and Louise closed the session with an invite to explore together the possibility of sourcing potential investors for the council loans it is arranging or for Abundance. Itself as another way to grow the proposition.
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