Giving Compass' Take:

• Emily Gustafsson-Wright and Izzy Boggild-Jones discuss the development impact bond that aims to improve maternal and neonatal mortality rates in the state of Rajasthan.

• What are the advantages of this model? Where else can this model be implemented? 

• Learn about Development Impact Bonds. 

On November 30th 2017, the world’s 5th development impact bond (DIB) launched at the Global Entrepreneurship Summit in India. This impact bond aims to improve maternal and neonatal mortality rates in the state of Rajasthan, which are among the highest in India.

The deal has the potential to reach up to 600,000 pregnant women with improved care during delivery and save the lives of up to 10,000 women and newborns over five years, tying the achievement of impact metrics to an $8 million outcome fund.

At the core of impact bonds is the principle of payment by results: investors provide service providers with upfront capital and outcome funders only pay them their principal plus a return if pre-agreed impact metrics are achieved.

The outcome metrics for this impact bond focus on the readiness for the NABH and FOGSI Manyata certifications (see Table 1). To achieve the full payment of $18,000 per facility, each facility will need to achieve at least 50 percent of total points available in each NABH chapter (see Box 1), and at 100 percent of least 11 of the 16 FOGSI standards (see Box 2).

Read the full article on the impact bond by Emily Gustafsson-Wright and Izzy Boggild-Jones at Brookings.