Global Innovative Finance Team

The UN estimates developing countries will need 2.5 Trillion USD a year to achieve the Sustainable Development Goals by 2030 and that the vast majority of these funds must come from non-government sources. There is an urgency for new financing sources that complement the ongoing financial strains.

Of recent times, we are finding the emer­gence of a number of new financing models, growing both in terms of their market size, their operations and the way they serve those in developing countries, as a new alternative. These innovative finance instru­ments are projected to unlock private capital and help further leverage public funding to mobilize various new sources of investment for public policy, social ser­vices and development goals, while at the same time realigning interests of various partners and creating new investment opportunities.

The Red Cross and Red Crescent is pushing the envelope in innovation and financing, and has already gained considerable credibility through global recognition from key influencers in this space for efforts thus far. Last year the IFRC established together with British, Denmark and Kenya National Societies a Global Innovative Finance Team (GIFT) with the aim of collaboratively structuring new financial mechanisms and adapting financial technologies to build capacity across National Societies by adopting a learning by doing approach and leverage new sources of financing to meet humanitarian and development needs.

Why Innovative Finance

Innovative Finance is not simply fundraising but illustrates a value chain model that has emphasis on developing capacity, exploring multiple business models and influencing a whole new way of transformative working and partnerships across the Federation and National Societies.

In our early exploration of potential, we have already begun interacting with various partners and seen the for­mulation of different models that together can make up a portfolio of innovative finance instruments that IFRC can deploy to not just unlock alternate capital for affected communities and National Societies but can also help accelerate our learning curve in a space that clearly has a lot of potential.

GIFT sits within the IFRC’s Global Innovation Team, under the Leadership of the Global Innovation Lead and the Under-Secretary General for Partnerships. The team will report to IFRC’s Innovation Lead, to deliver its mission, and is accountable for its management and outputs.

While the day to day operations of the unit are managed by the IFRC Innovation team, the overall initiative is guided by a small steering group that includes Senior representatives from contributing Partner Na­tional Societies, National Societies from priority Developing Countries and Senior Secretariat members including the USG Partnerships.

Library

GIFT 2018 Report

The GIFT aims to “Develop a portfolio of innovative finance experiments to improve understanding and accelerate capacity across National Societies to embed innovative finance into their operations through a “learning by doing” approach.”

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