What We Do
UNCDF addresses critical challenges in mobilizing private and public capital for high-risk, frontier markets.
As a non-credit rated development and finance organization, UNCDF acts as an off-balance-sheet de-risker for national governments and development finance institutions, uniquely positioned to unlock domestic resources and attract substantial private finance in underserved markets.
Through innovative blended finance solutions, UNCDF bridges investment gaps in fragile contexts where traditional financial mechanisms often fail.
Our approach de-risks investments and enhances access to capital, to pave the way for transformative change in the world’s most vulnerable regions.
Our investment toolkit includes grant-funded guarantees, concessional finance instruments, and performance-based payments. These tools expand financial access for underserved communities while also facilitating their transition to sustainable, commercially viable financing.
In addition, UNCDF strengthens national and sub-national public financial management systems and enhances financial ecosystems, laying the groundwork for long-term economic resilience. By working closely with the United Nations Development System and major development finance institutions, UNCDF amplifies their impact, accelerating progress toward the Sustainable Development Goals.
De-risking investment in frontier markets
Established by the United Nations General Assembly in 1966, the United Nations Capital Development Fund (UNCDF) was created with a singular purpose - to advance development where it is most needed - in the world’s most underserved markets.
As a UN entity with a capital mandate, UNCDF occupies a unique position in the development finance ecosystem. We are non-credit rated by design, enabling us to operate in high-risk environments that others avoid. This gives us the flexibility to absorb more risk than multilateral development banks (MDBs), while serving as an off-balance sheet de-risking partner for governments and major development finance institutions (DFIs).
We work where traditional finance does not flow: in Least Developed Countries, Small Island Developing States, and fragile contexts, where barriers to both public and private investment are highest, and the need for finance is most urgent.
UNCDF deploys a suite of catalytic instruments, including grant-funded guarantees, concessional loans, and performance-based payments, to unlock domestic capital and attract private investment. But we go beyond transactions. We catalyse local market development, strengthen public financial management systems, and build the financial ecosystems that enable long-term, sustainable investment aligned with the Sustainable Development Goals.
In doing so, we amplify the impact of the United Nations System and our multilateral partners, not by duplicating their work, but by laying the groundwork for others to scale.
Case studies
Our thematic areas
The 'UN Capital Development Fund's Strategic Framework 2022-2025' sets-out five thematic focus areas that frame our organization's value proposition for partners. Across these priority themes we deepen our focus as a financing enabler, deploying our unique capacity to drive increased finance flows to high-risk markets, to help mobilize and catalyze SDG-positive investments.
