By changing its structure to resemble a multilateral development bank, or MDB, the Green Climate Fund could obtain a high credit rating, borrow in the markets, and generate significantly more money to support low- and middle-income countries deal with mitigation and adaptation to climate change.
Given GCF’s current structure as a development finance institution, or DFI, it can only deploy its capital, as opposed to MDBs that have the possibility of leveraging their balance sheets, thus greatly increasing their business volumes and impact.
GCF is a specialized DFI created almost 10 years ago as the largest global fund dedicated to supporting LMICs' battle with climate change. GCF operates with a focused climate mandate, in contrast to MDBs, which have a much larger remit including poverty alleviation and private sector development as well as climate change.