As humanitarian funding retracts globally, the humanitarian system must adapt to the long-term realities of people displaced by conflict and disasters. Most refugees today have been displaced for more than a decade, yet the prevailing response model still treats them as if they only require short-term, life-saving aid.
In Tanzania, Simusolar sells solar-powered water irrigation pumps and fishing lights that helps farmers and fishers in displacement contexts save on energy expenses while increasing their yields. (Acumen)
While some communities do still require emergency support, many refugees are, or want to become, business owners, employees, and consumers in the places where they now live. They seek to contribute to their communities and to support their families sustainably, but the current aid architecture is not designed to promote these outcomes.
Refugee Lens Investing: An Innovative Approach
Since 2021, the Hilton Foundation’s Refugees initiative has been supporting innovative approaches like refugee lens investing (RLI) to provide a different kind of support to refugee communities. RLI blends grants and loans to support refugee-owned and refugee-serving businesses and helps build up and attract investors to the economic markets where refugees live.
Two new resources analyze the current RLI landscape and offer key insights into improving the impact and scale of this kind of investment.
State of RLI Tool: A Shared Data and Collaboration Platform
The Refugee Investment Network’s State of RLI Tool is a new interactive digital platform that enables investors, enterprises, policymakers and other stakeholders to perform several important functions:
Explore investment case studies that demonstrate viable models and returns.
Map capital flows to see how investment is reaching forcibly displaced populations and host communities.
Filter by region, sector, instrument, and investment type to identify gaps, opportunities, and potential partners.
Importantly, the State of RLI functions as both a knowledge platform and collaborative infrastructure, as it invites stakeholders to contribute data through a submission interface. By making RLI activity transparent and accessible, the tool supports better decision-making, more coordinated action, and a stronger investment ecosystem for refugees and host communities alike.
Displacement-Inclusive Investing: Broadening the Lens
A new comprehensive report from Innovest Advisory and funded by the Hilton Foundation provides an overview of the displacement-inclusive investing landscape — a term that expands on “refugee” designations to encompass all communities affected by forced displacement events, including forcibly displaced persons (FDPs) and host communities. It examines innovative or emerging investment approaches, investment strategies that combine existing approaches with a displacement lens and challenges to displacement-inclusive investing.
Key Takeaways from Innovest Advisory’s State of Field – Displacement-Inclusive Investing Report
Dedicated displacement-focused funds alone are not sufficient. While early funds such as the Kiva Refugee Investment Fund, Refugee Investment Facility and impact bonds have been critical in proving concepts and building an evidence base for RLI, they remain small relative to need. Scaling refugee lens investment to meet community needs will require embedding a displacement lens into mainstream funds and development finance institution strategies.
Refugee inclusion must be explicit. Evaluation of strategies implemented by development finance institutions and fragile and conflict-affected states indicates that “rising tide” investments such as general job creation do not automatically reach displaced groups. Legal, social, and market barriers often prevent displaced people from benefiting from generalized impact investing, demonstrating the need for explicit refugee inclusion objectives and key performance indicators.
Technical assistance is critical. With additional support, financial institutions and businesses can better understand displacement dynamics, adapt products to the needs of displaced communities, and design and implement meaningful impact measurement. Technical assistance also supports fund managers in adding a displacement lens to existing strategies and ensures it does not remain an “add-on” or secondary priority.
Risk-tolerant and blended capital can unlock markets but must be carefully targeted. Foundations and public funders can provide first-loss capital, guarantees or concessional debt in a way that encourages other investors to experiment in new markets and offsets real and perceived risks in fragile and displacement contexts. However, funders and investors must work to avoid over-subsidization, designing structures that are proportionate to actual risk and that strengthen, rather than distort, local markets.
Data and evidence gaps remain. RLI stakeholders have limited longitudinal evidence on the outcomes of refugee lens investments, such as long-term income and social cohesion, as most impact assessments to date have focused on outputs like loan volumes or jobs created. RLI stakeholders also need a better integration of humanitarian and development data, including refugee, IDP and host community data across agencies; as well as shared language and standards that make it easier to classify and benchmark investments. Digital tools like the State of RLI platform are an important step forward to meet these objectives of data sharing and analysis.
Learn More About the RLI Landscape
To learn more about the RLI landscape, including case studies on both adjusting existing investment strategies to include a refugee lens and emerging humanitarian approaches, please read Innovest Advisory’s State of Field report here.
