Climate finance is increasingly playing an important role in paving the way for low-carbon and climate-resilient investments, globally and in Africa. Climate finance helps to lower the cost of investment and buffers the risks both for sovereign and non-sovereign operations. Without concessional climate finance, the private sector would likely to be unable to play a key role in tackling climate change. The additional resources, through climate finance, are important for lowering investment risks and the establishment of an enabling environment for private sector operations. The overarching objective of this paper is to provide an overview of the key climate finance instruments, challenges and opportunities, and the role of the private sector in Africa. The study is descriptive and analytical. It makes use of qualitative and quantitative approaches for data collection and analysis. The paper identified the following climate finance instruments: equity, grants, loans, guarantees, line of credit, advisory services, green bonds, and policy based loan/budget support and purchase agreement for climate finance projects. In addition, the opportunities identified include the potential to invest in green infrastructure, clean energy, and provision of green jobs and development of the green economy. Lastly, some challenges include: high capital investments requiring upfront payments, lack of bankable projects in Africa and limited capacity of the private sector to participate in climate finance.