Towards adaptive and transformative finance for urban areas? A framework to analyse the responsiveness of adaptation finance to urban challenges in the global South

Funds-based mechanisms for urban adaptation finance are still underexplored. Addressing this gap, as well as the need for greater learning about 'how' urban adaptation finance operates, this paper proposes a conceptual framework for such analysis that considers complexity, uncertainty, transformation and vulnerability. We analyse 39 urban projects financed by Climate Adaptation Funds (CAFs) using a qualitative approach. The findings indicate the ongoing dominance of national governments at all stages of the funding cycle, and of a focus on "hard" adaptation measures, but also a diverse set of stakeholder relationships involved in CAF finance which offers potential for greater multi-stakeholder and multisectoral management of complexity. Few projects, however, address the management of uncertainty. While upscaling from projects is a common preoccupation, catalysing effects across sectors are limited, and transformative mechanisms for addressing vulnerability are limited to consultation with vulnerable groups. Innovations are highlighted which merit further exploration through case study analysis.