Requiring banks to hold more capital: Benefits and costs


Requiring banks to hold more capital: Benefits and costs


Innovative Financing Options and the Fight against Global Poverty: What’s New and What Next?

David de Ferranti
David de Ferranti Former Brookings Expert

July 1, 2006


Can innovative approaches to mobilizing and utilizing financial resources make a difference in the fight against global poverty? Potentially yes, this chapter argues; however, there is no silver bullet in the offing. New approaches can be useful additions to the current array of instruments and activities for helping developing countries, but will not be so broadly applicable and effective that the present mainstays will replaced or needed less. The innovations that have the biggest payoffs will draw especially on private sector channels, either exclusively or, more likely, in partnership with public sector and multilateral channels. The background for this issue is discussed first, then an overview of the options is provided; various ways of thinking about them are outlined, and, finally, three specific options are examined.