About
The V20 Sustainable Insurance Facility (V20-SIF) is a financial initiative established to support the development and availability of blended financial solutions that enhance the resilience of micro, small, and medium-sized enterprises (MSMEs) in the world’s most climate-vulnerable nations.
By helping to strengthen the markets of these nations against climate-related business interruptions, the V20-SIF aims to safeguard their economies by reducing the risk of catastrophic disruptions caused by climate change.
The V20-SIF was formed by the United Nations under the Principles for Sustainable Insurance in collaboration with the Munich Climate Insurance Initiative in response to the needs identified by the V20 Secretariat.
V20 Nations
The V20 was originally established to represent 20 of the world’s most climate vulnerable economies. However, due to advancing climate change, the V20 has now grown to include 74 nations spanning the Latin America and the Caribbean, Africa and the Middle East, and the Asia Pacific regions.
The V20-SIF works in close partnership with the Finance Ministers of V20 Nations to assess the needs of their economies, and provide expert technical insight for developing innovative solutions to enhance the climate resilience of these markets.
The Challenge
Micro, small, and medium-sized enterprises (MSMEs) represent more than 70% of livelihoods and 30-40% of total GDP in V20 markets. However, despite their economic significance to V20 economies, these businesses can struggle to meet the minimum threshold to access traditional financial protection products. Furthermore, MSMEs are particularly exposed to business interruption due to climate volatility, which is exacerbated by the difficulty face in accessing finance. As climate change continues to advance, with negative climate events increasing in rate and impact, this represents a significant economic risk to V20 Nations.
The V20-SIF is working towards overcoming this challenge by collaborating with the the V20 Secretariat, the financial industry in V20 regions, and other key partners globally to develop a suite of blended financial solutions, tailed to the specific needs of MSMEs and their investors, designed to strengthen the resilience of the world’s most climate-vulnerable economies.
V20 Nations have a collective population of more than 1.4 billion people, and a total GDP value of over USD 3.8 Trillion, with V20 markets constituting a significant portion of international trade. The cost of inactivity is too high, not only for the V20 nations themselves, and the people who live there, but also for the global economy at large.