Toronto, 21 May, 2025 — Today, Convergence, the global network for blended finance, launches the 2025 Spring Edition of its flagship report, the State of Blended Finance, which offers a snapshot of the overall market in 2024, including investor and deal trends.
Following record-high volumes in 2023, this report found that the blended finance market remained steady through 2024. Blended finance deal flow was higher in 2024 than the market average for the past five years, with 123 deals reaching close totaling $18 billion in financing. At the same time, deal sizes were trending upward, with the median size increasing from $38 million (2020 - 2023) to $65 million (2024) — reflecting growing ambition and scale. Median deal size was bolstered by three transactions exceeding $1 billion.
The report also found that there was more buy-in from the private sector. Commercial capital from private sector investors outpaced DFIs and MDBs in capital deployment, with $6.9 billion in investments in 2024.
“This report comes at a critical time as we see unprecedented cuts to ODA across the board and the dismantling of USAID, one of the most frequent investors in blended finance amongst official donor agencies,” says Joan Larrea, CEO at Convergence. “This current report looks at data from 2024, and will not reflect the impacts of these new challenges, which will no doubt be felt in the market this year and beyond. Instead, it offers a critical snapshot of the period before, and will be the year against which the future will be benchmarked.”
Development agencies and multi-donor pools have been the primary contributors of concessional capital, over the last three years they have contributed $5.1 billion in concessional capital, accounting for 65% of total concessional commitments. This report found that there is a maturation in how development agencies disburse concessional capital, moving from grants (41% in 2022 to just 10% in 2024) to risk-sharing instruments such as guarantees and senior debt, with guarantees rising from 11% to 27% and senior debt from 19% to 24% from 2022 to 2024.
Impacts from the war in Ukraine were felt in the blended finance market in 2024. Europe and Central Asia, historically underrepresented in the blended finance market, saw its share of deals rise from 10% in 2022 to 23% in 2024. The financing flows also rose significantly, from $2.8 billion in 2022 to $5.9 billion in 2024. This surge was largely driven by support for Ukraine, with a focus on the country’s economic stabilization, liquidity support, and continued access to essential services.
“Yet, despite positive signals from the blended finance market in 2024, scaling blended finance will require more than select large transactions and moderate market growth. A lack of structural standardization continues to slow the rollout and replication of blended structures, and in many cases, concessional capital mobilizes public commercial funding from MDBs and DFIs rather than private investment,” says Ayesha Bery, report author and Associate Director, Content, at Convergence.
Finally, this year’s report assesses the progress made over the past five years across the key challenges that blended finance faces, including the lack of private sector mobilization strategies amongst most donors, the need for greater levels of local capital mobilization, and the urgency of transparency and standardization. It also explores how the reduction in ODA will impact these challenges.
Analysis in the report draws from Convergence Market Data, the largest and most detailed database of historical blended finance transactions, comprising 1,350 blended finance transactions with a total investment of $249 billion.
About Convergence
Convergence is the global network for blended finance. We exist to increase private investment in emerging markets and developing economies to advance the UN Sustainable Development Goals and Paris Agreement.
Our members include private investors looking to diversify their portfolios, businesses seeking capital, as well as public agencies and philanthropic foundations looking to make their funds go further.
Media Contact
Sijia Yi
Head of Communications
Convergence
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