Many donors and impact investors today are looking to support new innovations to maximize their development impact. But with fintechs emerging all the time — many touting their potential to improve the lives of low-income, excluded customers with unproven business models — it is important for funders to be wary of hype and conduct due diligence in making investments and designing development programs. CGAP recently published a focus note presenting a vision for how development funders can support fintech in emerging market and developing economies to enable innovative business models that provide greater impact for poor people.
It offers guidance in three main areas:
- Assessing and managing the impact potential of fintech investments;
- Strategically funding to achieve impact and business potential;
- Influencing the market to support an ecosystem of FinTech's that serve low-income customers.
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