Innovative financing

Unlocking new revenue streams to scale up results for young people.

Four young people collaborate at a laptop computer in Viet Nam.
UNICEF/UN0215754/Viet Hung

How can innovative financing mechanisms unlock the potential of each of the other Promising Ideas?

The Issue

The scale of resources needed to address the needs of young people is considerable. The United Nations Conference on Trade and Development (UNCTAD) says achieving the Sustainable Development Goals (SDGs) will take between US$5-7 trillion, with an investment gap in developing countries of about US$2.5 trillion.

Skills and livelihoods have historically received limited resources from global aid budgets. Governments have also underinvested in this area, at least in part due to a lack of clear leadership in many countries as to which part of government leads this agenda.

The Opportunity

With the growing role of non-traditional actors in raising funds or stimulating actions in support of international development, there are new approaches emerging for pooling private and public revenue streams.

For example, since its first launch in 2013, 108 impact bonds have been contracted, with nearly US$400 million raised, mostly in rich countries at the municipal level.

The new revenue streams – types of taxes, charges, fees, bond raising, sale proceeds or voluntary contribution schemes – offer incentives to the investors and funders, including financial guarantees, corporate social responsibility, rewards and recognition.

Another potential opportunity hinges on the rise of impact investing, which engage private businesses interested in combining financial returns with social impact.

Download a PDF book of all Promising Ideas