IFC has nearly two decades of experience implementing blended concessional finance and currently manages and invests in projects supported by over a dozen Blended Finance facilities funded by various development partners.

From fiscal year 2010 to 2022, IFC has deployed $3.1 billion of concessional donor funds to support 369 high-impact projects in over 50 countries, leveraging $17.2 billion in additional financing.

  • $3.1BILLIONIN CONCESSIONAL DONOR FUNDS
  • 369PROJECTSSUPPORTED
  • 50+COUNTRIES
  • $17.2BILLIONIN ADDITIONAL FINANCING

While Blended Finance resources can be instrumental in helping move high risk/high impact projects forward, they must be used:

  • effectively to achieve the intended development impact and tackle specific market failures
  • efficiently to make sure that only the minimum concessionality needed is used to catalyze commercial capital, and
  • transparently to enhance the market creation potential of each transaction.

IFC applies a disciplined and targeted approach to blended finance, following the DFI Enhanced Blended Concessional Finance Principles for Private Sector Projects:

DFI Principles - Rationale

Rationale for Blended Concessional Finance
Contribution that is beyond what is available, otherwise absent from the market, and should not crowd out the private sector.

DFI Principles - Crowding-in and Minimum Concessionality

Crowding-in and Minimum Concessionality
Contribute to catalyzing market development and mobilization of private sector resources, with concessionality not greater than necessary.

DFI Principles - Commercial Sustainability

Commercial Sustainability
Impact achieved by each operation should aim to be sustainable and contribute towards commercial viability.

DFI Principles - Reinforcing Markets

Reinforcing Markets
Addresses market failures effectively and efficiently minimizes the risk of market distortion or crowding out private finance.

DFI Principles - Promoting High Standards

Promoting High Standards
Promote adherence to high standards, including in areas of corporate governance, environmental impact, integrity, transparency, and disclosure.

These enhanced principles and guidance for providing blended concessional finance for private sector projects includes guidelines for how to push for commercially viable solutions using minimum concessionality. In addition, it advocates for increased scrutiny of projects proportionate with the underlying risk that concessional resources could lead to market distortion.

Read more on the DFI Working Group on Enhanced Blended Concessional Finance for Private Sector Projects.