Toolbox on Financing Nature-Based Solutions

This report outlines strategies for scaling investment in Nature-based Solutions (NbS) through blended finance, highlighting the critical role of the public sector in providing technical assistance and concessional capital. It identifies guarantees as highly catalytic tools for de-risking private investment and emphasizes the need for ecosystem building and the creation of new revenue streams via beneficiary engagement and regulated markets (e.g., carbon and blue markets) to prove commercial viability.

• Guarantees are identified as the most catalytic instruments for attracting private capital to NbS because they de-risk investments and create a safer environment for testing new solutions, especially while revenue-generation capacity is still being proven. These instruments can be combined with capacity-building support to improve revenue potential and can be reused for new projects in subsequent cycles.
• The public sector is essential for scaling NbS by providing direct concessional funding, technical support, and creating regulatory environments and incentives that generate new revenue streams for NbS. This support helps build the necessary ecosystem and enabling conditions that private capital typically does not provide, eventually allowing for a transition to sustainable revenue flows.
• Because NbS markets are in an early stage, a focus solely on private sector engagement is insufficient. Effective scaling requires 'ecosystem building' through technical and financial assistance to prove commercial viability and profitability, often starting at a smaller scale before replication.
• Generating cash flows for NbS can be achieved by monetizing the value of interventions and incentivizing beneficiaries—such as insurance agencies, utility companies, and social enterprises—to engage with NbS providers. Additionally, the regulation and support of blue and carbon markets can create new revenue streams.

APA

Climate Policy Initiative (2024). Toolbox on Financing Nature-Based Solutions. https://www.climatepolicyinitiative.org/publication/toolbox-on-financing-nature-based-solutions/

Chicago

Climate Policy Initiative. Toolbox on Financing Nature-Based Solutions. 2024. https://www.climatepolicyinitiative.org/publication/toolbox-on-financing-nature-based-solutions/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Toolbox on Financing Nature-Based Solutions |date=4 September 2024 |url=https://www.climatepolicyinitiative.org/publication/toolbox-on-financing-nature-based-solutions/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2024toolbox, author = {{Climate Policy Initiative}}, title = {{Toolbox on Financing Nature-Based Solutions}}, institution = {Climate Policy Initiative}, year = {2024}, month = sep, url = {https://www.climatepolicyinitiative.org/publication/toolbox-on-financing-nature-based-solutions/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }