JPMorgan has created a $100 billion funding arm — the JPMorgan Development Finance Institution (DFI) — to expand investments in emerging markets and help the United Nations (U.N.) meets its Sustainable Development Goals, JPMorgan announced on Tuesday (Jan. 21).
JPMorgan consulted with other development institutions to develop defining principles to ascertain the prospects most likely to produce both financial and developmental gains.
“By defining eligible transactions and anticipating their impact, we can help attract much-needed private investment to developing countries,” said Daniel Pinto, co-president of JPMorgan Chase and CEO of the Corporate & Investment Bank. “Our aim is to increase engagement with clients and investors interested in financing critical projects and transactions in emerging markets.”
The DFI will be headed by Faheen Allibhoy, a country manager responsible for JPMorgan’s West African division. She brings nearly two decades of experience at the International Finance Corporation.
“It’s an honor and privilege to join JPMorgan’s DFI,” said Allibhoy. “JPMorgan’s global scale, expertise, and suite of financing capabilities provide an excellent platform to make a real difference in emerging markets.”
The U.N. is striving to tackle a host of issues in developing countries — from infrastructure and food security to climate change and health — by 2030. The investment gap is roughly $2.5 trillion of the estimated $5-7 trillion that is needed annually to address these issues. The JPMorgan DFI intends to shrink that gap.
JPMorgan anticipates that the DFI will bring more backers to assist with funding emerging economies. Last year the firm served people in 82 of the 144 World Bank-eligible borrowing countries.
It estimates the firm can finance development projects valued at more than $100 billion annually.
Earlier this month, JPMorgan Chase announced new security measures that would block FinTech apps from accessing customers’ passwords. The lender will disburse tokens to third parties, embedded with limited data.
