Investing in financial institutions in frontier markets: Lessons from DFI activity

In frontier markets, there is huge potential in financial sectors though they are currently often underdeveloped. It means businesses and individuals can lack access to credit and, when loans are available, they are usually short-term and concentrated on the trading and services industries. Developing financial sectors is a crucial step in increasing access to finance and enabling companies to grow.

This publication – the fifth in our Foundations of Growth series – highlights opportunities and approaches for development finance institutions (DFIs) and impact investors to contribute to the financial sector in frontier markets and support economic growth.

It is broken down into three sections that discuss:

• The characteristics of financial sectors in frontier markets

• Lessons learned from DFI activities

• Approaches to investing in the financial sector in frontier markets