Blended Finance Facility for Climate Change

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What is Blended Finance?

Blended finance leverages public and private capital to catalyze sustainable development. It combines concessional finance (grants, highly subsidized loans) with commercial investments to unlock private sector capital for climate action. This innovative approach aims to:

• Increase the scale and impact of climate investments: By de-risking private sector involvement, blended finance enables larger-scale projects and investments in climate mitigation and adaptation.
• Mobilize private capital: It incentivizes private investors to participate in climate-related projects that may otherwise be considered too risky or unprofitable.
• Address market failures: It helps overcome barriers such as limited access to finance, high transaction costs, and inadequate risk mitigation mechanisms.

Our Focus: 

Our Blended Finance Facility specifically targets climate-related projects in  renewable energy, sustainable agriculture, climate resilience in developing countries]. We prioritize projects that:

• Demonstrate high environmental and social impact: Contribute significantly to climate mitigation (reducing greenhouse gas emissions) and/or adaptation (building resilience to climate change impacts).
• Are financially viable: Have a strong business case and the potential to generate sustainable returns for investors.
• Contribute to local development: Create jobs, improve livelihoods, and enhance community well-being.

How it Works?

Project Development: We work closely with project developers to identify and structure bankable climate projects.

Risk Mitigation: We provide a range of risk mitigation instruments, such as: 

• Grants: To cover upfront costs, technical assistance, and de-risk early-stage investments.
• Guarantees: To reduce the credit risk for private investors.
• Equity Investments: To provide seed capital and attract further private investment.

Mobilizing Private Capital: We leverage our blended finance instruments to attract private sector investment from a range of sources, including: 

• Impact investors: Focus on social and environmental returns.
• Development finance institutions: Specialize in supporting sustainable development.
• Commercial banks: Provide debt financing for profitable projects.

Benefits:

• Increased climate ambition: Accelerates the transition to a low-carbon, climate-resilient economy.
• Sustainable development: Promotes inclusive growth and reduces poverty.
• Innovation: Fosters the development of new technologies and business models for climate action.

Call to Action:

• Project Developers: Submit your climate projects for consideration.
• Investors: Explore investment opportunities and partner with us to scale climate action.
• Partners: Collaborate with us to strengthen the climate finance ecosystem.