Giving Compass' Take:

• Milroy and Majdi Osman explain the value of Development Impact Bonds for driving youth development. 

• How can funders encourage the effective application of this method? 

• Read lessons from the world’s first Development Impact Bond In education.

Social impact bonds are beginning to be used more widely, particularly to fund programs for disadvantaged youth in high-income countries like the UK and the US. Examples include a SIB to fund interventions tackling recidivism among youth in Massachusetts and the UK and a DIB [Development Impact Bond] funding girl’s education in India (Educate Girls) and Pakistan. The world’s first DIB for health was launched in Uganda in 2014 to fund a program to reduce sleeping sickness. A social impact bond was created but not implemented to support the Gashora Girl’s School in Rwanda.

DIBs make sense for youth programs, as returns on investment continue throughout beneficiaries’ lifetimes. The structure of DIBs can allow for returns to be measured over several years, which is a more appropriate model for investing in adolescent health where results accumulate over time. Adolescents are a neglected age group in terms of health investment, so DIBs have the potential to increase funding for adolescent health improvement in resource-constrained areas. Programs that improve children’s and young people’s health have a dual return — not only does the program improve health, survival, and wellbeing but better health means they are more able to achieve their educational and economic potential throughout their lifetime.

Read the full article by Milroy and Majdi Osman about Development Impact Bonds from Youth Development Labs.