Climate Finance for Local Solutions
Making funding accessible where it’s needed most
Background
Global climate finance hit a record $1.9 trillion in 2023. Yet beneath that headline, the picture is far less equitable. Public climate finance declined by 8% from 2022 to 2023. And less than 10% of all climate finance reaches local actors, an even smaller fraction (around 1% or less) supports Indigenous Peoples and feminist organisations.
What is Climate Finance?
Climate finance is funding that helps communities adapt to climate change and reduce its impacts. For locally led solutions, it means getting resources directly into the hands of the people designing and delivering the solutions. This way, they can act quickly, effectively, and in ways that fit their context.
Why it matters for locally led solutions
Climate finance often fails to reach local communities. Without direct funding, solutions risk being top-down, slow, or disconnected from real needs. Climate finance for locally led solutions leads to more effective, fair, and sustainable outcomes.
Our Impact
By the end of 2025, VCA had helped mobilise and leverage over €52 million in climate and development finance across its seven countries, reaching over 2 million people and supporting 130 locally led climate solutions. This progress reinforces the alliance's position that climate finance reform must prioritise inclusivity, accountability, and justice, moving beyond disbursement volumes to emphasise ownership and impact at the local level.
Examples
Through direct support of the VCA, numerous funding opportunities at the local scale were made possible. For example, in 2024, on 15 occasions, VCA enabled village funds to be used for climate adaptation projects and local solutions in Indonesia, ranging in size from several hundred to several thousands of euros. For instance, the Women's Federation of Gedongkiwo received a budget of 2100 euros to fund river cleaning and conservation activities, urban farming training, and youth training. In total, Indonesia leveraged 1.2 million euros for the local solutions they support, with most of the funds (969.000 euros) coming from non-government sources.
Next Level Grant Facility
A key component of the VCA programme is the Next Level Grant Facility (NLGF), a €3.5 million small-grant mechanism specifically designed in collaboration with local fund managers in each country. The NLGF offers flexible, locally tailored approaches, such as emergency grants that can be approved within 48 hours to respond to crises, ranging from protecting environmental activists to pollution clean-ups.
Applications can even be submitted via WhatsApp or video in some contexts, ensuring accessibility. So far, the facility has distributed over 100 emergency grants and supported more than 150 locally led solutions.
As of March 2025, approximately €1.4 million of the NLGF funds have been disbursed. The funded initiatives span climate adaptation projects, such as reforestation and water conservation in Kenya and Zambia, legal advocacy and environmental protection efforts in Brazil and Paraguay, water security programmes in Bolivia and Tunisia, and disaster preparedness interventions in Indonesia.
