Making formalization financially attractive can be a strong incentive for entrepreneurs to gradually formalize their business. One way to do this, is by encouraging formalization through blended finance, where the size of loans is conditional on the gradual transition into the formal economy and where locally adapted formalization support such as training or information-sharing is provided. Making formalization easier and financially attractive can be implemented by financial service providers in the private and public sector, as shown in the two examples from Egypt and Chile.