OECD DAC Blended Finance Guidance 2025

6. Case studies

Abstract

As a new feature in the OECD DAC Blended Finance Guidance 2025, a series of case studies has been added to help practitioners and policymakers learn from concrete examples of blended finance in practice. These case studies are unfolded in an online repository which will be regularly updated as new instruments, approaches and methodologies in blended finance continue to evolve.

Introduction

This chapter introduces a series of case studies, each rooted in one of 15 distinct thematic areas, aimed to help practitioners and policymakers learn from concrete examples of blended finance. While there are literally hundreds of examples of blended finance projects, programmes and interventions in the ecosystem, the case studies here have been selected specifically to underpin the Guidance and buttress the messages.

The 15 thematic areas are (listed alphabetically): 1) additionality; 2) bonds; 3) collaboration and co‑ordination; 4) CSOs and blended finance; 5) country platforms; 6) enabling environment; 7) fragility; 8) guarantees; 9) impact management and measurement; 10) local currency; 11) securitisation; 12) structured funds; 13) theory of change; 14) trailblazing/market creation; and 15) transparency. These thematic areas do not intend to provide an exhaustive list of existing notions in blended finance; they have been selected because they represent core enablers, tools and concepts in blended finance and therefore constitute important building blocks for designing and deploying blended finance solutions that are efficient, impactful and scalable. They highlight persistent challenges but also emerging innovations in the field, and together they are meant to provide a resource for policymakers seeking to set strategic direction for their blended finance interventions, and for practitioners seeking to design, evaluate or scale blended finance solutions for sustainable impact.

Thematic case studies

The case studies within each of the thematic areas illustrate what works and why; they demonstrate innovative approaches and help translate the OECD DAC Blended Finance Principles into practice. Most importantly, the case studies support peer learning and replication by illustrating for practitioners and policymakers how peers have approached various challenges in blended finance and adapted tools and strategies to their own contexts.

It is important to note that the case studies have been presented in a summary format. They are meant to serve as appetisers for further investigation. Each case study thus provides links to more information. It is also important to note that the case studies constitute a living repository that will be updated on a continuous basis as the ecosystem continues to develop new instruments and approaches in blended finance.

This part of the Guidance can be used to browse the themes and explore topics of interest or relevance to specific challenges or contexts. It can also be used to compare cases across regions or instruments. And most importantly, lessons drawn from the case studies can be used to inform project design, policy development or investment strategies for donor agencies and other providers of development finance thereby helping to make blended finance interventions more impactful.

Blended finance is not a silver bullet to meet the financing needs of emerging markets and developing economies. It is an approach to help mobilise private finance and increase the flow of sustainable investment. By learning from the cases, this part of the Guidance is meant to help ensure that blended finance is not only mobilising private capital effectively but also delivers sustainable impact where it matters most.

Additionality

Introduction

Establishing additionality – both financial, development and value additionality – is core to blended finance and to development finance in general. It ensures that development finance is used efficiently to create development outcomes and mobilise private capital flows that would not have happened otherwise. Without additionality, blended finance risks misallocating scarce development finance, crowding out private capital and undermining its own credibility and accountability. Ensuring that blended finance interventions are truly additional brings value for money, prevents market distortion and crowding out of private capital, and strengthens the rationale for the intervention.

Why is this relevant to the Guidance?

While most blended finance initiatives today explicitly reference additionality in their design, the Guidance (particularly chapter 2) illustrates how challenging it is to assess and establish additionality. Providers of development finance have adopted various methodologies, with different questions, strategies and techniques being used to assess and establish additionality. This lack of standardisation is one of the key challenges of additionality assessment, alongside the methodological difficulties of the process, i.e. the establishment of a strong counterfactual and the lack of necessary data. Growing demands by a diversity of stakeholders for more robust evidence and transparency coupled with the experimentation of innovative approaches offer promising ways forward for the assessment of additionality in blended finance.

Case studies

The case studies on additionality illustrate different approaches to assess and document additionality by a range of actors including donors, MDBs and DFIs. They present different frameworks and methodologies and showcase good practices in assessing and documenting additionality. Together, the case studies aim to inspire providers of development finance and practitioners in blended finance when designing frameworks for additionality assessment.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Bonds

Introduction

Debt remains a key instrument in financial markets, with both sovereign and corporate borrowing increasing significantly since 2007 and set to continue rising (OECD, 2025[1]). Bonds are also a powerful way to mobilise private investors towards developing countries, as investors are familiar with these instruments – which are typically liquid, have well-understood structures and a long-term duration. Green, social, sustainability and sustainability-linked (GSSS) bonds can be used in particular to finance sustainable assets/projects, or to incentivise behaviour towards sustainability objectives. They therefore leverage the benefits of traditional bond instruments to link scale with impact. When considering the issuance of bonds – both vanilla and GSSS – the question of debt sustainability is particularly important, especially for developing countries.

Why is this relevant to the Guidance?

Bonds, and GSSS bonds in particular, are not blended finance instruments per se – rather, whether they are considered blended finance depends on the involvement of development actors in mobilising additional finance (OECD, 2023[2]). For example, donors can support issuances via first-loss anchor investments or through the provision of credit enhancement. When deploying blended finance in this way in the context of bonds, all five Principles and related Guidance should be closely followed. Beyond this, donors can contribute to the development of the GSSS bond market (and the catalysation of private finance) more broadly – for example through the provision of technical assistance to guide the issuance process or supporting a strong enabling environment.

Case studies

The case studies on bonds highlight different ways in which donors have effectively supported GSSS bond issuances and the market more broadly. They include sustainability-linked bond (SLB) issuance with credit enhancement that demonstrates how donors can use blended finance to directly support issuances. They also include donor engagement with the broader market infrastructure for bonds – for examples through support to transparency platforms or capacity building for diverse market players.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Collaboration and co-ordination

Introduction

Blended finance inherently involves multiple actors including donors, MDBs, DFIs, private investors and government agencies. When these actors compete or work in silos, it can often lead to inefficiencies, fragmentation and suboptimal outcomes in relation to mobilisation of private finance. Efficient collaboration and co-ordination between the diverse stakeholders can help address these challenges. However, collaboration among stakeholders – including around innovative and scalable approaches in blended finance – is notoriously difficult to establish. The challenges are rooted in different policy priorities, institutional mandates, operational models, risk appetites, incentives and political economy dynamics. Aligning a diverse set of stakeholders’ interests is not easy to achieve, neither among donors nor between donors, MDBs and DFIs.

Why is this relevant to the Guidance?

Collaboration and co-ordination are central to the concept of blended finance itself and are therefore relevant to all the five Principles. Collaboration and co-ordination can – and should – happen at multiple stages of the blended finance process. Even before a specific blended finance operation is designed, collaboration and co-ordination around blended finance principles and frameworks is already crucial. At the project level, efficient collaboration and co-ordination can support the derisking of transactions and/or provide additional support to ensure a transaction can take place. At the portfolio level, collaboration and co-ordination allow for a more flexible and dynamic approach when deploying capital, where investors pool resources to spread risks across multiple projects. At the funds and facility level, collaboration and co‑ordination can aggregate large pools of capital among multiple stakeholders, including donors, allowing for the scalability and standardisation of blended finance interventions.

Case studies

The case studies on collaboration and co-ordination demonstrate the potential of working more together for mobilising private finance for sustainable development. They illustrate a.o. how providers of development finance can partner with, for example, utility companies and government agencies to achieve sustainable development objectives, and how donor agencies can work together to scale up the mobilisation of private finance. They also provide examples of international platforms designed to increase collaboration and scale up the mobilisation of private finance.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Country platforms

Introduction

Country platforms are government-led co-ordination platforms which bring together relevant stakeholders to co-ordinate and align on investment goals and priorities. Country platforms have emerged as a new form of alliances which can promote strong partnerships for blended finance. They can help reduce fragmentation, increase scale and impact, provide risk mitigation and enhance transparency. Their key challenges include: bringing together stakeholders with diverse mandates, preferences, resources, etc. such as governments, national and international private investors, development finance providers and local stakeholders; and transforming nationally determined contributions, national adaptation plans and other national strategies into investable opportunities.

Why is this relevant to the Guidance?

Country platforms can support the implementation of blended finance as they encourage both a whole-of-government approach to development finance and public-private collaboration. Investing through country platforms helps ensure that blended finance interventions align with broader national priorities, policies, plans and local investment blueprints, and that consultations are undertaken with relevant stakeholders. Aligning blended finance with local development priorities and ensuring country ownership enhance the likelihood of achieving transformative and sustainable outcomes. Local policies, plans and investment blueprints typically include nationally determined contributions and national adaptation plans but also integrated national financing frameworks, national biodiversity strategies and action plans, sector plans and other relevant long-term strategies.

Case studies

The case studies on country platforms highlight how these platforms have been able to improve the effectiveness, alignment and impact of development finance in developing countries. They illustrate that such platforms, when well-designed and government-led, can reduce inefficiencies and provide an enabling environment that is suitable for scaling blended finance and mobilise private capital.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

CSOs and blended finance

Introduction

Civil society organisations (CSOs) play an increasingly important role in blended finance. A dual role of CSOs has crystallised where the community maintains a critical voice to ensure that blended finance is additional and avoids over-subsidising commercial investors. At the same time, CSOs increasingly engage in blended finance transactions with commercial partners and development finance providers where they play a key role ensuring that projects are tied to development outcomes, facilitating stakeholder engagement, providing local expertise and capacity building, advocating for safeguarding social and environmental standards and monitoring and evaluating projects. CSOs are thus becoming important partners in blended finance as they bring unique perspectives, expertise and accountability to the process.

Why is this relevant to the Guidance?

The involvement of CSOs is important for all five Blended Finance Principles. As CSOs can act as intermediaries between development finance providers, private investors and local communities, they can help facilitate dialogue between project stakeholders and ensure projects are inclusive and tied into the local context. CSOs have extensive experience providing technical assistance and training for local stakeholders, and from working as implementing partners for a range of projects financed by development co-operation funds. CSOs can also play an important role in monitoring and reporting on blended finance projects by collecting data on development outcomes, ensuring accountability and transparency in project implementation, and reporting on the social and environmental impact of projects.

Case studies

The case studies on CSOs and blended finance highlight the diverse and increasingly significant roles CSOs play as partners in blended finance initiatives. The cases demonstrate how CSOs can act as critical intermediaries between private investors and local communities, helping to align financial objectives with local development needs and social impact. The cases studies also show how CSOs can serve as key providers of capacity building for local stakeholders.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Enabling environment

Introduction

Fostering strong enabling environments is essential for the effective and scaled use of blended finance and for the creation of a resilient investment climate more broadly. Enabling environments build investor confidence; they also create the necessary conditions for private capital to flow effectively into sustainable development projects and endure beyond a period of donor support. A robust enabling environment includes transparent regulatory frameworks, sound governance, stable macroeconomic policies and strong institutional capacity, all of which reduce perceived risks for investors.

Why is this relevant to the Guidance?

Without the foundation of a robust enabling environment that is conducive to private investment, even well-structured blended finance mechanisms may struggle to attract long-term private investment. Moreover, supporting enabling environments is crucial to the rationale of blended finance itself – i.e. ensuring that it remains a temporary solution. While the enabling environment is thus particularly key to Principle 3, which explicitly focuses on tailoring blended finance to local context, it is central to the concept of blended finance itself, therefore relevant to the application of all five Principles. More broadly, donors have a role to play in providing macro-level catalytic technical assistance to support the enabling environment, for example through the provision of capacity building, and in support of regulatory and policy changes to facilitate more domestic and international private finance flows.

Case studies

The case studies on enabling environments highlight different ways in which donors have effectively supported an enabling environment which in turn unlocked further private capital. The cases show how combining regulatory reforms with capacity-building efforts can catalyse investment, enhance financial inclusion and strengthen resilience. They also exemplify how international financing can be blended with bilateral donor grants to provide an integrated package which includes policy dialogue, technical assistance and financing facilities. Ultimately, these approaches stimulate sustainable growth by creating a strong enabling environment and complementing this with targeted financing.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Fragility

Introduction

In states and territories characterised by high or even extreme fragility, persistent political instability, weak governance and recurring economic shocks severely undermine the ability of public authorities and private actors alike to deliver essential services and sustain development. Conflict, natural disasters and large-scale displacement exacerbate these vulnerabilities, deterring conventional investors and leaving communities trapped in cycles of poverty and insecurity. In such environments, blended finance must be carefully tailored to address both the deep-rooted causes of fragility and the immediate risks that discourage private participation.

Why is this relevant to the Guidance?

Blended finance can help to de-risk projects also in zones of high or even extreme fragility. However, such zones may require differentiated and context-sensitive approaches in blended finance. Efforts must focus on designing financial tools and instruments that are appropriately tailored in both size and structure to meet the specific needs of the target markets. The specific needs may include customised levels and duration of concessionality; enhanced risk mitigation strategies; refined project selection criteria that emphasise developmental additionality; impact measurement frameworks that go beyond traditional metrics; application of ESG/performance standards that integrate conflict sensitivity, distributional equity, and safeguards for local market integrity; realistic timelines and expectations regarding the path to commercial sustainability; and strategic partner selection, including both official development actors and private sector player with relevant risk appetite, local understanding, and mission alignment. In addition, achieving success in such contexts often demands parallel investment in enabling conditions such as support for market infrastructure development, regulatory reform, project pipeline generation and the strengthening of local technical and institutional capacity.

Case studies

The case studies on fragility highlight how blended finance can be adapted to very challenging contexts while still delivering mobilisation of private finance and impact. The cases a drawn from a variety of geographical contexts and they illustrate how blended finance considerations have included political and security analysis as well as peace and development focus while taking into account the need for strong de-risking tools, local capacity building and flexibility in structuring.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Guarantees

Introduction

Guarantees are the second most-used mechanism to mobilise private capital (after syndicated loans), making up USD 17 billion of the USD 70 billion of private finance mobilised in 2023 (OECD, 2024[3]). Guarantees act as a catalyst, combining impact and efficiency. By providing partial or full protection against losses, they help mitigate the perceived and actual risks – political, currency or other country risks – that often deter private investors from entering emerging markets. Moreover, particularly unfunded guarantees are a good way for development finance providers to optimise their balance sheets as they do not require an immediate outflow of funds by the guarantors.

Why is this relevant to the Guidance?

The de-risking function of guarantees is key in scaling blended finance as they help mobilise significant volumes of private capital towards sustainable development projects. Guarantees can also help crowd in first-time investors, build market confidence and can be structured to support local financial institutions, further deepening domestic capital markets. The interest in using guarantees as a risk-mitigating instrument to mobilise private finance has increased since 2020 partly due to the OECD DAC reform of private sector instruments, which agreed in 2023 to include guarantees as an ODA-eligible instrument. Guarantees are an instrument that should be further explored in the current context as they can effectively mobilise private finance at scale and also promote access to finance in underdeveloped and underserved markets, such as the least developed countries.

Case studies

The case studies on guarantees highlight the capacity of guarantees to unlock additional finance at scale, contribute to more inclusive, liquid and resilient money markets in challenging financial environments and provide access to finance for underserved SMEs. The cases illustrate how flexible and powerful the guarantee instrument is to unlock finance, provide access for underserved segments and create markets ensuring that blended finance is used as a transitory measure.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Impact management and measurement

Introduction

Impact management and measurement (IMM) systems are essential for ensuring that blended finance answers to its development rationale, i.e. contributes to achieving the 2030 Agenda, the goals of the Paris Agreement or other development frameworks. IMM systems thus help ensuring that development finance delivers measurable development and climate outcomes, not just financial returns. They also help track additionality and enable accountability and transparency by providing a shared results framework with clear reporting on what is being achieved. Robust IMM systems can thus support better project design and risk management. However, challenges to establish and using a robust IMM system persist. These include a lack of available and accessible data (especially in emerging markets); limited technical capacity and resources in local administrations; knowledge gaps; and poor contextual understanding.

Why is this relevant to the Guidance?

Robust IMM frameworks are crucial to blended finance and go hand-in-hand with the need for transparency and accountability. IMM ensures that blended finance is rooted in clear development objectives by proposing solid and clear results frameworks through which operations can be designed and monitored. Directly linked, IMM is also key in aligning stakeholders’ interests, building investors’ confidence and thus attracting more capital. In addition, IMM systems support better project design, build market credibility and investor confidence and help align blended finance with both local and global priorities. Establishing and using robust IMM systems is thus relevant for all the five Principles of blended finance.

Case studies

The case studies on IMM systems highlight how different organisations have designed robust IMM frameworks and integrated IMM into their development finance operations. The cases illustrate a.o. the use of clear theories of change, alignment with development objectives, integration of impact into the entire investment process as well as learning and adaptation loops.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Local currency

Introduction

Most development finance and private capital is still disbursed in hard currency, even in projects with exclusively local revenue streams. Hedging mechanisms for investments in developing countries are limited and local capital markets are shallow. This is compounded by lack of credit enhancement, high transaction costs and investor preference for hard currency. The predominance of hard currency financing is a serious challenge. Across EMDEs, projects within infrastructure, SMEs and social sectors typically generate revenues in local currency, but if financing is denominated in foreign currency, borrowers will be exposed to volatile exchange rates that threatens project viability.

Why is this relevant to the Guidance?

Local currency financing is particularly relevant to consider for blended finance operations as it reduces currency risk which is one of the main risks when investing in emerging markets. Local currency financing reduces the exchange rate risk for borrowers and enhances the sustainability of investments in developing countries (Horrocks et al., 2025[4]). By facilitating local currency lending, blended finance can help ensuring that projects are more in line with local economic realities, increasing debt affordability and promoting the growth of the domestic financial markets. Additionally, it makes financing more accessible to local institutions and businesses who might not otherwise be able to get access because of currency mismatch problems. By mitigating exchange rate risks and facilitating more scalable investments in local markets, promoting local currency financing is thus critical to attract private capital that might otherwise be deterred by unpredictable exchange fluctuations. Furthermore, aligning financing structures with local economic conditions helps to build up domestic financial institutions, ensuring that investments are better tailored to the local needs of the market. In addition to improving financial resilience, a localised strategy promotes long-term growth and creates a more conducive environment for private sector involvement and investment in emerging economies. In this way, local currency financing cuts across the blended finance Principles and the Guidance for their implementation.

Case studies

The case studies on local currency highlight the potential of local currency financing on mobilising private finance. The cases illustrate how various local currency financing initiatives have played a catalytic role; succeeded in crowding in local pension funds and banks; created new instruments, institutions or market norms; expanded lending to underserved segments; and reduced vulnerability to global financial shocks. The cases underscore how local currency financing is not just a technical preference but rather a development necessity.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Securitisation

Introduction

Securitisation is a financial technique that bundles together pools of assets (like loans, mortgage or receivables) and transforms them into tradable securities which are then sold to investors. It is a critical enabler for scaling up the mobilisation of private finance – especially institutional investors – for development objectives such as infrastructure, climate and SMEs in EMDEs. Securitisation unlocks institutional investment at scale, recycles capital for MBDs, DFIs and local commercial banks and catalyses market development through demonstration effects.

Why is this relevant to the Guidance?

Securitisation in development finance is relatively novel and its potential remains untapped. By pooling assets, it reduces individual project risk and creates investment products that are attractive to a broader range of investors. Securitisation is thus a powerful tool that can be used to scale mobilisation of private finance and provide access for institutional investors to an exposure in EMDEs that they would otherwise not get.

Securitisation is a tool that should be further explored in blended finance. Both policymakers and practitioners in blended finance should be more curious about the potential of securitisation. However, it is also a complex financial engineering tool that may be associated with certain risks. It is thus important to understand the different types of securitisation models and the roles securitisation can play in relation to both balance sheet optimisation and the mobilisation of private finance at scale. It is also essential for donors and practitioners in blended finance to understand the risks and the limitations related to different securitisation models.

Case studies

The case studies on securitisation illustrate the potential for mobilising private finance using different securitisation approaches. These include both synthetic securitisation and true-sale securitisation, and they illustrate how assets in EMDEs – for example infrastructure loans and SME loans – can be investible and attractive for institutional investors even without any concessionality.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Structured funds

Introduction

Structured funds are designed to pool resources and strategically distribute risks across different tiers of capital. These vehicles play a critical role in mobilising private finance for development, particularly in higher-risk markets and sectors such as infrastructure, renewable energy and climate resilience. By blending development/concessional and commercial capital within a single fund structure, structured funds allow for differentiated risk-return profiles tailored to diverse investor preferences. This enables development finance to absorb certain risks – often through a junior or first-loss tranche – thereby crowding in private investors into transactions that would otherwise be considered too risky.

Why is this relevant to the Guidance?

Structured funds are a key innovation in blended finance because they bring together diverse stakeholders – donors, DFIs, institutional investors and fund managers – under a common investment vehicle. Their layered design allows donors and other development finance providers to take on risks that private investors cannot, helping to unlock capital that would not otherwise flow into developing countries. At the same time, they offer a powerful demonstration effect when structured transparently and priced appropriately, contributing to long-term market development.

Yet structured funds also face challenges. Their effectiveness depends on careful structuring to avoid over-subsidisation and market distortion. Clear rules on concessionality and exit strategies are essential to ensure that structured funds deliver sustainable impact, crowd in rather than crowd out private capital and build functioning markets over time. Also, structured funds face challenges especially around fragmentation and lack of standardisation that can limit their scalability, efficiency and impact. Guidance for using structured funds is therefore appropriate to ensure they deliver sustainable impact while mobilising private finance.

Case studies

The case studies on structure funds highlight how donors and development actors can support structured funds to unlock private finance at scale. The cases illustrate several core design principles and common features around layered risk-sharing, impact-integrated design and strong governance that explain why the funds have been effective in mobilising private finance while delivering impact in EMDEs. The cases underscore that structured funds are one of the most effective tools in blended finance when quality, impact and investor alignment are properly managed.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Theory of change

Introduction

In the context of blended finance, a theory of change provides a structured way to understand how a series of targeted interventions can lead to long-term, transformative outcomes. It is not just a planning tool – it is a mindset that ensures every financial innovation, pilot or investment structure is grounded in a larger vision for systemic change. By mapping out causal pathways from inputs via outputs to outcomes and impact, a theory of change helps actors remain focused on the broader development goals they aim to achieve, particularly in complex, high-risk markets.

Why is this relevant to the Guidance?

For blended finance to be truly catalytic, it must do more than mobilise capital – it must reshape the systems that prevent capital from flowing in the first place. A strong theory of change helps development actors align their financial tools with market-building strategies, ensuring that short-term interventions contribute to long-term change. It also provides clarity for investors and stakeholders, helping them understand how risk mitigation, technical assistance or progressive financing strategies are expected to unlock broader economic, social or climate-related impact.

In relation to the OECD DAC Blended Finance Principles, a theory of change illustrates the link between Principle 1 that ensures a development rationale for all blended finance interventions (“doing the right thing”) and Principle 5 that ensures results are monitored, documented and disclosed (“proving it was the right thing to do”). A strong theory of change is thus a critical tool linking the two Principles.

Case studies

The case studies on theory of change highlight different ways in which a theory of change has been embedded into blended finance interventions – for example by aligning currency risk tools and institutional investor mandates with long-term SDG goals, building inclusive infrastructure access in fragile contexts or designing a progression model that helps clients evolve across financing stages. The case studies demonstrate how a clear causal logic can guide the deployment of blended finance towards deeper, more sustainable outcomes.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Trailblazing: Market creation for small-scale opportunities

Introduction

In many frontier and emerging markets, small-scale enterprises and underserved sectors remain out of reach for traditional finance. These segments – such as early-stage SMEs, agricultural businesses or community-level infrastructure – are often perceived as too risky, too small or too complex for established financial institutions to serve. Trailblazing in this context refers to pioneering new financial solutions, institutions or models that intentionally target these market gaps. It is about breaking new ground where no market exists – laying the foundations for sustainable, inclusive growth in geographical areas and sectors that matter most for development.

Why is this relevant to the Guidance?

Trailblazing is essential in blended finance because it creates the enabling conditions for investment where none previously existed. By testing new financial instruments and structures, redefining risk-return expectations and building capacity within local markets, trailblazing efforts help transform high-risk, low-investment environments into more viable and investable ecosystems. These efforts not only unlock capital in the short term; they also shift how the market sees value, opening doors for broader systemic change over time. Trailblazing helps create pipeline and increase deal flow; it unlocks investment in underserved markets, and it demonstrates what is possible and thereby creates pathways where private finance can later flow. Yet trailblazing is high-risk by design and not all efforts will succeed. It requires strong impact measurement and patient capital, and efforts should be undertaken transparently and with an exit strategy to avoid over-subsidising or creating market distortions.

Case studies

The case studies on trailblazing illustrate how financial innovation in underserved markets have helped unlock investment for higher-risk, small-scale segments of stakeholders. Each case demonstrates a unique approach to building investable opportunities, whether through incentive design, long-term capital or structured progression. Together, they highlight how blended finance can pioneer solutions that build markets and drive inclusive growth in challenging environments.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

Transparency

Introduction

Transparency in development finance, and blended finance in particular, is about providing clear, accessible and timely information on how development finance is used, what development outcomes have been achieved and how risks and returns are distributed among stakeholders. It covers both development outcomes, mobilisation volumes and financial data. It is thus about reporting on development impact using agreed systems and metrics; disclosing volumes of private finance mobilised using agreed reporting standards; and disclosing financial terms of deals including size and structure of development finance and private contributions, levels of concessionality and risk sharing arrangements. Transparency also covers development-, financial- and value additionality to ensure development finance is truly being additional to what the market is prepared to offer.

Why is this relevant to the Guidance?

Transparency is critical for blended finance. It promotes public accountability as it allows assessment whether development finance is used efficiently, effectively and fairly in blended finance. It enables private institutional investors to assess risk and market opportunities, and it promotes replicability which reduces cost and enables standardisation. Transparency and accessibility of data is the foundation for a robust monitoring and evaluation system and a key enabler of financial innovation as it encourages the development of new financial instruments. Beyond this, transparency is crucial to assess the impact of blended finance operations and keep track of precedents that can enable learning from good practices.

While the rationale behind transparency is solid, the road towards full transparency and disclosure in development finance has so far been complex. Key challenges persist including lack of data, especially in emerging markets; confidentiality concerns of different stakeholders; and the cost of data collection and dissemination required by transparency, especially for smaller organisations.

Case studies

The case studies on transparency illustrate the importance of transparency in blended finance including how transparency has enabled mobilisation of private capital for example by enabling access to information about investment opportunities in EMDEs. The cases also illustrate how indexes can promote transparency among development finance institutions.

Link to the online repository (https://www.oecd.org/en/toolkits/blended-finance-case-studies.html).

References

[4] Horrocks, P. et al. (2025), Unlocking local currency financing in emerging markets and developing economies, https://www.oecd.org/content/dam/oecd/en/publications/reports/2025/02/unlocking-local-currency-financing-in-emerging-markets-and-developing-economies_af15df6a/bc84fde7-en.pdf.

[1] OECD (2025), Global Debt Report 2025: Financing Growth in a Challenging Debt Market Environment, OECD Publishing, Paris, https://doi.org/10.1787/8ee42b13-en.

[3] OECD (2024), Leveraging Private Finance for Development, https://www.oecd.org/en/topics/leveraging-private-finance-for-development.html.

[2] OECD (2023), “Green, Social and Sustainability Bonds in Developing Countries: The case for increased donor co-ordination”, OECD Development Perspectives, No. 31, OECD Publishing, Paris, https://doi.org/10.1787/1cce4551-en.