According to the financing model of the Urban Challenge

Solution

The Urban Challenge Fund requires cities to mobilise at least 50 percent of the total project cost from market sources. These sources include municipal bonds, bank financing, and public-private partnerships. This requirement represents a shift from traditional grant-based urban development funding to a more market-linked financing approach. By encouraging cities to access capital markets and private sector funding, the scheme aims to strengthen municipal financial systems and enhance accountability in infrastructure projects. The approach also promotes large-scale investment in urban development by leveraging both public and private financial resources.