UN Capital Development Fund (UNCDF) is the only UN agency mandated to focus primarily on the least developed countries (LDCs), currently supporting 33 out of the 48 LDCs, with country level programmes, as well as regional and global programmes. UNCDF is also working in 6 Southern non- LDCs.
UNCDF provides investment capital and technical support to both the public and the private sector. It provides capital financing -- in the forms of grants, soft loans and credit enhancement – and the technical expertise in preparing portfolios of sustainable and resilient capacity building and infrastructure projects.
UNCDF has proven its ability to deliver true leverage on smaller and more risky investments and interventions within its core areas of expertise: Inclusive Finance and Local Development Finance. The concept- proven pilot projects and programmes are replicated and brought to scale with the help and the add-on financing of other development partners with different and complementary mandates.
UNCDF’s work on inclusive finance:
UNCDF’s work on inclusive finance seeks to develop inclusive financial systems and ensure that a range of financial products is available to all segments of society, at a reasonable cost, and on a sustainable basis. UNCDF supports a wide range of providers (e.g. microfinance institutions, banks, cooperatives, money transfer companies) and a variety of financial products and services (e.g. savings, credit, insurance, payments, and remittances). UNCDF also supports newer delivery channels (e.g. mobile phone networks) that offer tremendous potential for scale.
The CleanStart Programme’s vision is to dramatically expand consumer financing for low-income consumers who want to transition to cleaner and more efficient energy. To make this happen it partners with microfinance institutions and energy enterprises – offering seed capital and advice – to test scalable financing solutions in varying market conditions.
As a global programme, CleanStart aims to support low-income consumers in six countries to transition to cleaner and more efficient energy through microfinance by 2017. The programme is designed to provide risk capital and technical assistance to competitively selected financial service providers and energy enterprises to:
Develop and refine scalable consumer financing models (Output 1: Finance for Clean Energy);
Increase the ‘scale’ potential of these models by tackling critical bottlenecks in the value chain (e.g. distribution, consumer awareness) (Output 2: Technical Assistance for Clean Energy);
Make research and tools generated in the process widely available to the industry (Output 3: Global Knowledge and Learning);
Advocate for positive industry-wide changes and broker partnerships with upstream value chain actors (e.g. investors, policy makers) (Output 4: Advocacy and Partnerships)
CleanStart is supporting a range of enterprises beyond microfinance institutions, and promoting financing solutions that go beyond credit for energy. It also seeks to support energy enterprises to effectively link with financial service providers.
The Global Programme Implementation Unit is based in the UNCDF Asia-Pacific Regional Office in Bangkok, Thailand.
CleanStart Programme Nepal
Nepal is one of the first CleanStart countries in Asia. Since April 2014, the CleanStart Programme has been working closely with financial services providers in Nepal to expand micro-loans for cleaner and more efficient energy such as solar lighting and improved cooking solutions such as biogas digesters. The four partners are Ace Development Bank Ltd. (ACE); Jeevan Bikas Samaj (JBS); Sana Kisan Bikas Bank (SKBB); and Clean Energy Development Bank Ltd (CEDBL), and together they have set out to reach at least 102,000 households and micro-entrepreneurs throughout Nepal. By January 2015, these partners collectively provided energy loans to over 10,000 clients, with the bulk of loans financing solar home systems of 20 Watt peaks or higher.
ACE, CEDB and SKBB are providing wholesale financing to microfinance intermediaries of various scales from one of the largest regulated microfinance institutions to small farmers’ cooperatives. JBS is a retail microfinance institution focused on seven districts in Eastern Nepal.
CleanStart has also formalized a partnership with the Alternative Energy Promotion Centre (AEPC). Areas of collaboration include brokering partnerships between financial institutions and energy solutions providers, quality assurance, advocacy and monitoring and evaluation. Partnership with AEPC is integral to the day to day implementation and monitoring of the programme.
AEPC implements the National Rural and Renewable Energy Programme (NRREP). NRREP is the single national programme for small-scale decentralized energy in Nepal. CleanStart contributes to the goals and targets of NRREP, especially in the operationalization of the Central Renewable Energy Fund (CREF).
The CleanStart Business Plan for Nepal (endorsed by the Government of Nepal in September, 2012) guides the implementation of CleanStart in the country.