Digital Financing for All SDGs

Digital finance helps to channel more resources toward all of the SDGs, albeit through different pathways. Goals in areas such as sustainable infrastructure, energy, water, transport, and financial services, are more easily financialized because they have paying users. Digitalization helps direct existing public and private investments but also empowers individuals to invest in sustainable infrastructure and utility services by reducing information gaps.

Digitalization allows transaction visibility and traceability of production, employment, and business conditions related to economic SDGs, such as decent work, manufacturing, agribusiness, sustainable production and consumption. Such transparency, coupled with lower cost of services delivered through digital platforms, supports expanded provision of affordable and tailored financial services. Digitalization also supports unconventional mechanisms for financing economic activities that bypass the traditional financial system, such as crowdfunding or (community) crypto-currencies and facilitate sustainable consumer purchases.

Digital financing can target reduction in the negative effects of global consumption and production patterns on environmental SDGs. Satellites, sensors, publicly available scientific data and ESG disclosure help capture and integrate information about climate change, biodiversity loss, pollution and disaster risks into financing decisions, for example via green securities and sustainable robo-advisors. Digital platforms support carbon markets, which grew fivefold between 2017 and 2019, reaching US$215 billion. Objective, automated verification through data tokens can support scaling of carbon trading.

Progress on social SDGs hinges to a large extent on the ability to effectively manage public financing and assess performance of institutions. Digitalization improves availability of data on public services and citizens’ ability to review and demand accountability. Digital finance reduces remittance and e-transfer costs and enables e-service provision. It also supports innovations such as gender lens investing, P2P international giving, micro-insurance, or bias-detecting algorithms. Analysis of macro level data shows that access to mobile phones is positively associated with multiple indicators linked to social development, such as lower gender inequalities, enhanced contraceptive use, and lower maternal and child mortality.

	Economic	Environmental	Social
More and Better Data	Transaction records Credit scoring IoT data / smart metering Supply chain tracking Open government data Crowdsourced project accountability data Open finance	Satellite imagery IoT data / smart metering ESG data Data tokens for climate impact reporting	Gender-disaggregated data Open public finance data Transparent public records Crowdsourced project accountability data ESG data
Cheaper Intermediation and Aggregation	Mass-market digital finance Pay-as-you-go utility financing models Digitalized value chain / trade finance Fair trade, ethical, sustainable ecommerce / digital marketplaces	Digital exchanges for carbon credits / bio-diversity offsets Platforms for climate project financing Aggregation / securitization of assets Green banking products	Remittances / humanitarian transfers Digital marketplaces / ecommerce platforms Mass-market digital finance Digital education / health care financing schemes E-government services
Disintermediation and New Business Models	Crowdfunding / P2P lending Gamified ‘green’ consumption Circular economy models Fractional asset ownership Digital currency-based project finance / community services AI-enhanced tax optimization	E-trading of natural capital backed digital assets Remote verification insurance and financing Gamified sustainable behaviours Sustainability robo-advisors	Gender-lens crowdfunding & investing robo-advisors Bias detection algorithms Robotized m-education / health Digital micro-insurance Participatory budgeting Algorithmic illicit flow tracking Digital donation platforms

	Economic
More and Better Data	Transaction records Credit scoring IoT data / smart metering Supply chain tracking Open government data Crowdsourced project accountability data Open finance
Cheaper Intermediation and Aggregation	Mass-market digital finance Pay-as-you-go utility financing models Digitalized value chain / trade finance Fair trade, ethical, sustainable ecommerce / digital marketplaces
Disintermediation and New Business Models	Crowdfunding / P2P lending Gamified ‘green’ consumption Circular economy models Fractional asset ownership Digital currency-based project finance / community services AI-enhanced tax optimization

	Environmental
More and Better Data	Satellite imagery IoT data / smart metering ESG data Data tokens for climate impact reporting
Cheaper Intermediation and Aggregation	Digital exchanges for carbon credits / bio-diversity offsets Platforms for climate project financing Aggregation / securitization of assets Green banking products
Disintermediation and New Business Models	E-trading of natural capital backed digital assets Remote verification insurance and financing Gamified sustainable behaviours Sustainability robo-advisors

	Social
More and Better Data	Gender-disaggregated data Open public finance data Transparent public records Crowdsourced project accountability data ESG data
Cheaper Intermediation and Aggregation	Remittances / humanitarian transfers Digital marketplaces / ecommerce platforms Mass-market digital finance Digital education / health care financing schemes E-government services
Disintermediation and New Business Models	Gender-lens crowdfunding & investing robo-advisors Bias detection algorithms Robotized m-education / health Digital micro-insurance Participatory budgeting Algorithmic illicit flow tracking Digital donation platforms

Findings: More and Better Data
Findings: Reduced Transaction and Intermediation Costs
Findings: Innovative Business Models