Mongolia is a nation rich in resources, opportunity, and potential. With its vast fertile land, abundant mineral wealth, and a young, highly literate population, the country has drawn increasing interest from foreign investors and technology partners, particularly in the mining sector. Yet, behind this promise lies a complex set of challenges. Issues of wealth distribution, social welfare, environmental protection, and resource allocation are pressing concerns that risk undermining Mongolia’s progress.
As the country stands at a crossroads, the choices it makes today will determine whether it falls prey to the “Resource Curse” and Dutch Disease or whether it harnesses its assets for sustainable, inclusive growth. One critical pathway forward lies in strengthening its Small and Medium Enterprise (SME) sector, which—if supported with targeted funding and investment—could provide innovative solutions to pressing social challenges while diversifying the economy beyond mining.
The proposal for a Social Impact Fund in Mongolia was developed with this vision in mind. Backed by TenGer Capital, the initiative focuses on mobilizing investments of USD 50–70 million into SMEs that create measurable social and environmental impact. Key areas identified include agriculture, education, healthcare, affordable housing, and waste management—sectors that are vital to national development and social well-being.
TenGer Capital, part of the TenGer Group which includes XacBank and other financial institutions, is well positioned to lead this initiative. With its history of providing fair access to financial services across all 21 provincial capitals, XacBank in particular has a strong track record in supporting micro and small businesses. Through this project, the Fund seeks to empower entrepreneurs, enable socially oriented enterprises, and attract investors who are committed not only to financial returns but also to creating lasting social impact.
This report represents the outcome of an intensive two-week effort by a team of 35 individuals, who came together to analyze Mongolia’s opportunities and challenges in designing a Social Impact Fund. It outlines the rationale for such a fund, highlights priority sectors for investment, and recommends governance structures, criteria, and approaches tailored specifically to the Mongolian context.
While not exhaustive, the report captures a promising and actionable vision for how impact investing can serve as a catalyst for Mongolia’s sustainable and inclusive development. It provides both a roadmap and a call to action—laying the groundwork for partnerships, innovations, and investments that can shape Mongolia’s future prosperity.