Meeting global and local development goals will require unprecedented investment. Public resources alone cannot bridge the gap – private finance has a significant role to play. Development banks and development finance institutions (DFIs) are central to this effort, accounting for nearly all private finance mobilised in developing countries through development finance. Significant progress has been made in recent years, yet mobilisation still remains well below needs and too often peripheral to the operations of development banks and DFIs.
This report identifies the institutional levers that can help development banks and DFIs to shift from being primarily lenders and co-financiers to becoming catalytic mobilisers of private investment. These levers include clearer mandates and strategies; more flexible and catalytic financial models; and operational systems with incentives, skills and culture aligned to mobilisation. With decisive shareholder support and collective action across institutions, development banks and DFIs can unlock far greater volumes of private capital – helping to close financing gaps and driving growth, resilience and prosperity.
