UNDP and UNCDF work hand in hand to drive sustainable development by addressing policy, institutional, and financial barriers that hinder investment in critical sectors. While UNDP and UNCDF are governed by similar financial rules and regulations, UNCDF’s distinct and separate financial rules relating to the deployment of grants as loans and guarantees to initiate financial derisking, unique in the UN system, offers a strategic complementarity of services to countries to scale investment for critical development priorities.

While UNDP focuses on strengthening enabling environments and addressing institutional and regulatory barriers to investment, UNCDF directly deploys financial instruments and catalytic capital to private sector, financial intermediaries, and governments to de-risk investments and mobilize additional public and private resources – both domestic and international. Through its investment mandate, UNCDF uses blended finance structures, such as first-loss capital, guarantees, and concessional loans (at 0 percent or very low interest), to mobilize public and private capital in high-impact initiatives, particularly in frontier and last-mile markets.

These joint efforts are increasingly critical as countries face intersecting crises and more frequent shocks. To ensure crisis response does not lead to a loss of development gains, early investment is needed to support recovery and build long-term resilience. Together, UNDP and UNCDF help bridge the gap between policy ambition and real investment for developing countries, building a more inclusive global financial ecosystem that drives investment for sustainable economic development, climate and biodiversity targets, and recovery and resilience needs.

Together, UNDP and UNCDF bring complementary strengths to support countries in building resilient, inclusive, national financing ecosystems. Under UNCDF’s leadership in capital deployment and UNDP’s policy and development expertise, we help governments not only design Integrated National Financing Frameworks (INFFs), but also translate them into investable outcomes. The join offer enables countries to unlock domestic and international capital, expand access to inclusive, climate-aligned, crisis-sensitive, and locally led finance, and direct resources where they are needed most: the last mile.