Client name: UK Department for International Development (DFID)

Duration: 2000-2009

Location: Africa and South Asia

As manager of DFID’s Financial Deeping Challenge Fund (FDCF), Coffey worked to deepen financial markets and broaden access to finance for the world’s poor.  


The Financial Deeping Challenge Fund (FDCF) was one of DFID’s first pilots of the challenge fund mechanism. Challenge funds were a response to a growing belief that the Millennium Development Goals could not be met without significant participation of the private sector in activities that directly contributed to poverty reduction.

It was realised that access to financial services was critical to pro-poor development and that private sector financial institutions were best placed to widen access. Improved access would facilitate entrepreneurship, create wealth, and reduce poverty by catalysing economic activity, job creation and trade.

The FDCF was a way to engage private sector institutions in increasing access to financial services.


Coffey was the manager of the FDCF. The fund sought to support projects and grant applications from the private sector that:

  • contributed, directly or indirectly, to improved incomes, livelihoods and opportunities for poor people
  • involved a product, service, system or procedure that was innovative, and would be unlikely to be addressed by the private sector without the support of the FDCF
  • resulted, directly or indirectly, in increased access to financial services by the poor
  • did not create unfair competition or otherwise distort markets

Coffey assisted with the design of new fund applications, monitored and supervised projects to ensure they reached their targets, and provided on-going support to enable fund grantees to resolve implementation problems.


Over nine years, Coffey supported 28 funded projects. Throughout the course of the fund, over 80% of the funded projects were completed and sustained to a satisfactory standard.

M-PESA - The greatest success of the fund is in its contribution to the creation of the mobile money system M-PESA in Kenya. Coffey supported Vodafone in its application for an FDCF grant that would allow the company to test its new mobile service in the developing world. When Vodafone won the grant, we helped it find the right Kenyan and Tanzanian microfinance institutions to work with on the project.

Once Vodafone piloted its new service in Kenya, it became clear that facilitating access to microfinance was just one of the benefits the service could provide. Kenyans testing the service used it to send money to family and friends, to safely store cash during journeys, to pay off private loans, and more.

The project team learned from the pilot, ‘tweaked’ the service, and in 2007 Vodafone’s M-PESA was officially launched. The new mobile money service gave people a quick, secure, and cost-effective way to transfer money, often across great distances. Since then M-PESA has been used by more than 14 million Kenyans.