Solvatten AB is a Swedish actor who in 2011 got the opportunity to work with the Kenyan Institute of Environment and Water and distribute its innovative and climate-friendly water purification units to 2 500 households in the slum area of Kibera in Nairobi, Kenya.
Photo: Solvatten AB
To encourage new ideas and innovations in development cooperation, Sida provides different actors the opportunity to compete for funding from challenge funds. Sida supports a number of challenge funds in different areas in order to find the best solutions to various development challenges.
A challenge fund is a financing mechanism where donors use competition to find solutions to problems in areas related to development. Each challenge fund has its specific goals; it may be finding solutions to a particular health problem or methods to promote democracy through ICT (Information and Communications Technology). All the challenge funds financed by Sida target developing countries and look for solutions that benefit people living in poverty.
Small and medium-sized enterprises, organizations, institutions and individuals compete by submitting their project proposals to the challenge fund in question. While they have to meet predetermined and fixed criteria, the applicants have great freedom in the design of their solution. The winning proposals are supported financially and in many cases also receive advice to enable further development and scale-up of products or methods. The financing from the challenge fund must usually be matched by a certain percent of self-funding.
The projects supported through the Sida-funded challenge funds target high-risk markets in developing countries where there are no investors or other capital. Since complex problems require innovative solutions Sida is willing to accept a higher rate of failure when using this method. The idea is for Sida and partners to support innovations in their early stages and that the activities then will become self-sustaining.
Call periods for the challenge funds vary - see Calls and Announcements for updates. The exception is the Global Innovation Fund, which at present doesn't have a deadline for applications and is open until further notice. You can read more about the different criteria and how to apply at the websites of the respective funds.
Sida-funded challenge funds
Sida's own Challenge Fund, Innovations Against Poverty, is a global fund that supports innovations, methods and business models that benefit people living on less than 2 dollars per day. IAP provides two types of funding, small and large, up to 50 percent of the total project cost. Innovators are also offered advice and access to the Practioner Hub.
Financed together with DFID, USAID, Omidyar Network and the Australian government. Global Innovation Fund invests in innovations with a strong potential for large scale social impact among people living in poverty. The fund has a greater focus on the innovative aspects of proposals than other Sida-funded challenge funds. In order to reach as many people living in poverty as possible, innovations can receive support of up to 15 million USD.
The program is funded by Sida and managed by The Swedish Agency for Economic and Regional Growth. It connects companies who have innovative solutions to global environmental challenges with expertise on how these solutions can be tailored to the local context in 11 selected countries.
Operates locally and nationally in twelve countries; Ghana, South Africa, Kenya, Tanzania, the Philippines, Indonesia, Pakistan, Uganda, Bangladesh, Nigeria, Mozambique and Liberia. Its focus area is strengthening democracy through ICT (Information and Communications Technology) and the innovations called for are often methods or platforms rather than products. The fund is financed jointly by Sida, USAID, DFID, the Open Society Foundation and Omidyar Network.
Looking for innovative solutions to development challenges related to water scarcity in the agricultural sector in developing countries. The fund is global and supports innovations that make it possible to cultivate crops using less water, or that make more water available for cultivation through better use of different water sources. Securing Water for Food is financed by Sida, USAID and the Dutch government.
Looking for innovative approaches and products to increase access to sustainable energy in the agricultural sector in developing countries. Innovations should facilitate the work of people working in agriculture and increase their productivity. Powering Agriculture is financed by Sida, USAID, BMZ, OPIC and Duke Energy.
Provides financial assistance and loans for innovative projects in sectors such as agriculture, renewable energy, climate change adaptation, financial services as well as information and media services with links to these sectors. The projects must be commercially viable with a strong potential for societal impact and operate in sub-Saharan Africa. The fund is financed by Sida, DFID, DFAT, Danida, DGIS and CIDA.
A regional fund supporting internet development and digital innovation that can make development projects more effective and inclusive. The main focus of the fund is openness, rights and inclusion. The fund operates in Africa, Asia and Latin America and the Caribbean. In addition to financial support, the fund offers capacity building for innovators. Sida finances Seed Alliance together with the International Development Research Centre (IDRC), African Network Information Centre (AFRINIC), Latin America and Caribbean Network Information Centre (LACNIC) and the Asia-Pacific Network Information Centre (APNIC).
Handled by the Swedish embassy in Colombia.