How we work
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ADA takes a holistic approach to meeting the needs of vulnerable people by supporting entire local economic systems. To this end, ADA supports local businesses and organisations in developing tailored and complementary products and services while also strengthening the financing chain to attract capital into the system.
Vulnerable populations face multiple challenges such as income insecurity, low economic resilience and difficulties in meeting their basic needs such as access to energy or water and sanitation.
A holistic approach for complex needs
Supporting local stakeholders
These complex and interlinked challenges require a holistic approach. ADA does not interact with these target populations directly but instead supports local businesses and organisations in developing tailored, lasting and sustainable products and services for vulnerable people. For example, local businesses are supported in strengthening their internal organisation and in accessing impact financing.
Creating synergies between services
ADA particularly encourages partnerships between providers to offer vulnerable people a combination of services that enables them to launch and grow their own business and improve their living conditions. These services can include financial services such as loans or insurance, improved market access, training in entrepreneurship or sustainable agriculture as well as a connection to a solar energy grid.
Supporting the entire economic system
By supporting and connecting multiple actors, ADA strengthens the entire local network of businesses, workers and resources as well as the exchanges of goods and services, which is called a local economic system. ADA thereby creates an environment which is favourable to economic growth and personal development.
Impact finance as a development tool
Mobilise funding
At the same time, ADA leverages its expertise in impact and inclusive finance to attract local and international capital into the local economic system by supporting the wider financing chain. This capital is then invested in strengthened, local businesses, enabling the local economy to grow in a lasting, autonomous and sustainable manner for the benefit of all.
Guide investment
In addition to providing technical assistance to local financial service providers in the Global South, ADA acts as an impact investment adviser to Luxembourgish investment vehicles such as LMDF (Luxembourg Microfinance and Development Fund), Investing for Development (IforD) and the Financing Innovation Tool (FIT). ADA prospects, selects and performs a social and financial analysis of innovative, financially inclusive institutions with a significant social impact, thereby directing the flow of capital to where it is most impactful.
An innovative approach
ADA’s technical assistance is provided in an innovative, experimental manner. Short-term test projects are run with actors deemed to be best placed for developing solutions for vulnerable people before implementing larger, more ambitious programmes.
Once a test project or programme has been completed, ADA analyses the impact of selected activities and publicly shares its experience and knowledge gained for the benefit of other development and impact finance stakeholders.
