The Role of Guarantees in Blended Finance

This paper takes stock of the use of guarantees in the blended finance market, examining their key benefits, challenges, and barriers to more common deployment in developing contexts, especially in least developed countries. It investigates the potential role of guarantees in light of COVID-19 and post-pandemic recovery efforts. The paper concludes with recommendations for development agencies and public institutions to promote more ubiquitous use of guarantees, including improved uniformity in structuring and ODA-eligibility.