The Fund for Innovation in Development: financing innovative solutions for the fight against poverty and inequality

The Fund for Innovation in Development (FID) is launching its first call for projects to boost, accelerate and roll out innovative solutions against poverty and inequalities. This new facility strengthens and supplements France’s official development assistance tools. It offers flexible grants adapted to the various stages of development of the innovations, and swift disbursement, including for small sums, providing security in this way for the risk-taking that is inherent to innovation. It encourages “disruptive” innovations, which enable marginalized citizens to access everyday services by making them simpler, more practical and less costly.

The types of financing proposed operate using flexible grant conditions:

• Stage 0 - Project preparation (up to €50,000): finances the project kick-off and promising applications which would have had fewer possibilities of obtaining financing otherwise;
• Stage 1 - Pilot phase (up to €200,000): finances the pilot phase for innovations in the early stages of development, and have already come through the prototyping stage and are ready for field trials;
• Stage 2 - Test and preparations for scale-up (up to €1.5 million): finances in-depth experimentation and innovation build-up to assess the viability at a larger scale;
• Stage 3 - Scale-up (up to €4 million): finances the transition of solutions that are rigorously and scientifically approved towards a generalized scale-up;
• Public policies transformation (TPP) (up to €150,000): finances innovations that have reached a certain stage of maturity and have a high acceleration potential to transform public policies.

The FID is chaired by Esther Duflo, Nobel Prize in Economics 2019. Its aim is to support all structures (research bodies, governments, NGOs, businesses, etc.) that innovate to combat poverty, with one particular aspect: promoting rigorous scientific approaches capable of accelerating projects likely to have a high impact and transform development policies. The Fund encourages proposals addressing the priority areas of French assistance (education, health, climate and gender equality) and is open to all types of innovations:

• technical,
• social,
• financial,
• environmental certifications,
• governance-related,
• process-related, etc.

It can support any innovation project aimed at low- or middle-income countries, with special attention paid to the 19 priority countries for French assistance.

The FID is hosted at the Agence Française de Développement (AFD) as part of a management agreement with the Ministry for Europe and Foreign Affairs, and the Ministry of the Economy, Finance and the Recovery. With independent governance and operating methods, for the first year it has a budget of €15 million.

Officially announced at the Presidential Council on development meeting on 17 December 2020, the creation of this Fund embodies the commitment of the President of the Republic in support of modernizing official development assistance. Following up on the proposals of Deputy Hervé Berville’s report, the FID is a new initiative that is consistent with the guidelines set out in the bill on inclusive development and the fight against global inequalities, acknowledging a renewed partnership with partner countries, especially African countries, and with all development stakeholders concerned in France.