Delivering the 2030 Agenda and the Paris Agreement will require all sources of finance — public and private — to be scaled up and aligned with sustainable development. Blended finance can play an essential role in unlocking and channelling commercial finance towards sustainable development in developing countries. However, it remains a relatively new tool in development co-operation. While many donors have well-established blended finance programs, others are just now starting to deploy blended finance. The OECD DAC Blended Finance Guidance is a policy tool to help all providers of development finance — donor governments and agencies, multilateral donors, philanthropies and other stakeholders — to put the Blended Finance Principles into practice and effectively design and implement blended finance programs. Approved by the DAC in September 2020, the Guidance outlines policy recommendations and provides good practice examples as well as practical checklists and key references on blended finance. The Guidance is the result of an extensive, multi-stakeholder consultation process, involving international experts, practitioners and researchers. The Guidance ultimately aims to enhance the growth and improve the quality of finance that is mobilised and invested in sustainable development in developing countries.
