Reinvestment Fund today announced the creation of a $10 million Pay for Success (PFS) Fund to support PFS transactions in the United States. QBE Insurance Group, one of the world’s top 20 general insurance and reinsurance companies, plans to invest $7 million in the fund. Living Cities, a collective of the world’s largest foundations and financial institutions, plans to invest $2 million.  Reinvestment Fund will invest $1 million from its core loan fund, which is supported by more than 850 impact investors. Reinvestment Fund will also manage and administer the fund.

PFS is an innovative financing mechanism that aligns private investment with promising policy interventions and high impact social services, while offsetting the financial risk if the programs do not achieve the desired results.

We are excited to launch this fund with some of the most experienced PFS investors in this still nascent field in the United States,” said Don Hinkle-Brown, President and CEO of Reinvestment Fund. “The PFS Fund offers an innovative organized capital source that will bring efficiency to these transactions by reducing costs and speeding deal execution.”

The PFS Fund will support the scaling of promising policy interventions, and is likely to grow as it is proven effective.  This first of its kind PFS financing mechanism is an important opportunity to align private investment, public policy innovation and high-impact social services. The PFS Fund will support transactions across a range of policy areas, including but not limited to social services, health care, housing, and education.

Read the source article at Reinvestment Fund