Opportunities for UK development banks

This research project is led by the UCL Institute for Innovation and Public Purpose (UCL IIPP).
Explore all IIPP research projects here. 

Dates of the project: 2017

The Challenge 

The UK faces a persistent gap in long-term, strategic finance to support innovation, infrastructure, and inclusive growth. While other countries successfully leverage state investment banks to drive economic transformation, the UK lacks a coherent framework for how development banks can play a similar role. 

The challenge is to identify how such institutions should be designed to deliver patient capital and public value across both national and devolved contexts. 

Our Approach 

UCL IIPP carries out a study, funded by Ferguson Marine Engineering Limited, to explore the potential for development banks in the UK. The research: 

• Analyses the activities and design features of successful state investment banks globally.
• Investigates how these institutions contribute to innovation, economic growth, and resilience.
• Provides insights to inform UK and devolved government policymaking, including the creation of the Scottish National Investment Bank, announced in the Scottish Government’s 2017–18 Programme for Government. 

The study supports the design of financial institutions that are mission-oriented, capable of delivering long-term investment, and aligned with public purpose.  

Why This Matters 

Development banks act as powerful tools for shaping inclusive and sustainable economies. By learning from international best practices, this project helps the UK design institutions that can provide strategic finance for innovation, infrastructure, and the green transition. 

IIPP’s work contributes to a broader rethinking of how finance serves people and planet, not just markets. 

Resources 

Video: Public Banks at a time of COVID-19: Opportunities, threats, just transitions
Speakers: Thomas Marois, Judith Clifton and Olga Mikheeva.
Description: Thomas Marois presents his research on public banks during COVID-19 as part of the IIPP Seminar Series 2020–21, with discussion from Judith Clifton and moderation by Olga Mikheeva.

Video: The Global Commission on the Economics of Water
Speakers: Diana Barrowclough, Jayati Ghosh, João Marcos Hausmann Tavares and Olga Mikheeva. 
Description: This discussion explores innovation systems in the Global South, linking them to national industrial goals while addressing technological and financial dependency through the lens of finance, innovation, and political economy.

Funder

This project is funded by Ferguson Marine Engineering Limited. 

This research project is led by the UCL Institute for Innovation and Public Purpose (UCL IIPP).
Explore all IIPP research projects here.