The role of the private sector in responding to protracted refugee situations is shifting from traditional approaches (e.g. financial donations, or provision of goods and services as a contractor) to approaches that leverage private sector capabilities. An IFC survey of private sector initiatives working with refugees and host communities in 25 low- and middle-income countries found several emerging types of private sector engagement in protracted refugee situations: (a) funding of humanitarian assistance; (b) leveraging private sector capabilities—often technology or technical expertise—to provide humanitarian assistance, education or financial services; (c) extending or adapting business models to provide goods and services to refugees (e.g. telecoms and banks); (d) providing job training and entrepreneurship support, often via online platforms or focused on technology skills; (e) hiring refugees, and/or working with smaller enterprises that hire refugees; and (f) selling goods and services to refugees, and often providing them with local employment opportunities. Technology and financial services companies lead one-third of identified initiatives. Private sector engagement is still nascent—with mostly small initiatives, in early stages, and with limited evidence of impact. There is wide geographic spread, with a focus on Syrian crisis. There is significant variation of efforts necessitated by each country’s unique context and constraints. The study identifies common success factors and challenges, and recommends areas for improvement.
- Common success factors: designing initiatives from the perspective of refugees and host communities; partnerships with public and nonprofit organizations with relevant expertise/experience; commitment from CEO-level leadership; and clear goals.
- Common challenges: policy and regulatory constraints; limited understanding of forced displacement; inherent risks in serving refugee populations; and limited accessibility to refugees.
- Suggested areas for improvement: developing mechanisms for coordination and learning; equipping private sector actors with tools and information to engage refugees; emphasizing more engagement of the local private sector; catalyzing large scale philanthropy and (impact) investment; and supporting social entrepreneurship.