UNCDF in Afghanistan
Asia and the Pacific Region
Guarantees
In Afghanistan, the United Nations Capital Development Fund (UNCDF) catalyzes private sector growth and financial inclusion through targeted innovative intervention. Operating in a challenging economic landscape marked by liquidity constraints and regulatory uncertainty, UNCDF's work focuses on unlocking capital for micro, small and medium-sized enterprises (MSMEs), prioritizing women-led enterprises and underserved sectors. By leveraging catalytic finance and digital innovation, UNCDF partnership with UNDP complements national priorities, driving systemic change and fostering inclusive growth.
Through a pioneering Sharia-compliant Portfolio Guarantee Facility, UNCDF, together with the United Nations Development Programme (UNDP) and the Afghanistan Credit Guarantee Foundation (ACGF) is transforming MSME finance in Afghanistan, helping micro, small, and medium-sized enterprises access much-needed capital to recover, grow, and create jobs, with a particular focus on women-led businesses and underserved sectors.
At the same time, the Afghanistan Digital Prosperity Project is strengthening the country’s digital financial ecosystem by supporting mobile money operators, microfinance institutions, payment institutions, and fintechs to develop inclusive and affordable solutions. By expanding agent networks and building financial literacy, this initiative is advancing digital access and inclusion for women and rural communities.
Together, these efforts illustrate how catalytic finance and digital innovation can drive economic resilience and inclusive growth in Afghanistan.
Guarantee facility for MSMEs
In partnership with the United Nations Development Programme (UNDP) and the Afghanistan Credit Guarantee Foundation (ACGF), UNCDF has established a Sharia-compliant Portfolio Guarantee Facility to unlock capital for MSMEs and catalyse private-sector lending. The facility shares risk with local financial institutions, supported through a re-guarantee mechanism by ACGF, and includes a dedicated tranche for women-led enterprises.
By reducing risk for lenders, the initiative helps revive businesses, sustain jobs and restore essential services in sectors such as agriculture, trade and production. To date, 7,444 MSMEs have been financed, including 2,255 women-owned enterprises, supporting 14,212 jobs for men and 4,701 for women. The guarantee has achieved 16 times guarantee leverage and 20 times portfolio leverage, meaning that every dollar of concessional capital has mobilized nearly twenty dollars in private-sector lending. Looking ahead, UNCDF aims to expand the facility's reach and deepen its gender lens to further empower Afghan entrepreneurs.
Partner institutions include OXUS, First MicroFinance Bank–Afghanistan (FMFB), and Ghazanfar Bank, which together are driving a systemic shift in how MSMEs are financed across the country.
Ghulam Abas Alizada Carpet Weaving company, Mandavi, Kabul, Afghanistan. Photo: MALA Project/Mahab Azizi.
Photo: UNDP.
Afghanistan Digital Prosperity project
The project is accelerating the country’s transition to a robust, inclusive digital financial ecosystem. UNCDF partners with mobile money operators, microfinance institutions, payment institutions, and fintechs to design solutions that are both inclusive and offline-ready, addressing barriers such as connectivity gaps.
It supports the expansion of agent and merchant networks, builds digital and financial literacy, and fosters partnerships to scale last-mile access for women and underserved communities. UNCDF is supporting Mutahid Microfinance to digitize Murabaha vendor payments through HesabPay, with more than 31 vendors onboarded and over 412 payments executed through digital wallets. The initiative also supports OXUS in developing its digital transformation strategy and is piloting a shared-agent model to expand agent networks across provinces.
These efforts strengthen transparency, efficiency and resilience within Afghanistan’s emerging digital economy. In 2026, UNCDF targets national multi-media awareness and partnerships forged through the UNDP Access to Finance Flagship initiative to increase adoption amongst women entrepreneurs and new fintech initiatives to drive last-mile access and market innovation.
A farmer fills out a loan repayment form using the HesabPay digital wallet. Photo: UNCDF.
A farmer fills out a loan repayment form using the HesabPay digital wallet. Photo: UNCDF.
Across these initiatives, the United Nations Capital Development Fund continues to deploy innovative finance and digital solutions to drive sustainable development and economic resilience in Afghanistan.
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Our partners
UNCDF’s work in Afghanistan is made possible thanks to the United Nations Development Programme (UNDP), Afghanistan Credit Guarantee Foundation (ACGF), OXUS Afghanistan, First MicroFinance Bank–Afghanistan (FMFB), Ghazanfar Bank, and HesabPay.
Documents
This section brings together key documents related to UNCDF’s work in the country. It includes a curated selection of publications, papers, and reports that reflect the scope of engagement at country level, from programme design to implementation and outcomes.
These documents offer additional context on how initiatives are developed and delivered, and how partnerships contribute to advancing national priorities. They are intended to support transparency, facilitate knowledge sharing and serve as a practical resource for partners, stakeholders and others seeking a deeper understanding of UNCDF’s work.
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Contact us
For inquiries about UNCDF’s work in Afghanistan, including partnerships, investment opportunities, or ongoing initiatives, please contact our team at asiapacific.region@uncdf.org. We welcome collaboration with private sector actors, financial institutions and development partners to drive innovation and impact in Afghanistan's financial sector.
