Giving Compass' Take:

• Shamika Ravi and Prerna Sharma discuss the success of the Educate Girls Development Impact Bond in Rajasthan.

• How can this model be successfully replicated elsewhere? 

• Learn about the state of the global impact bond market. 

Three years ago, an innovative financing experiment was started in Rajasthan. Called the Educate Girls Development Impact Bond (DIB), the programme aimed to provide a targeted intervention to 9,000 out-of-school girls in Bhilwara district. In a district where one in 10 girls aged between 11 and 14 were kept out of school, the DIB sought to increase school enrolment and improve learning outcomes. On July 13, it was announced that the programme had achieved 116% of its enrolment target and 160% of its learning target. Surpassing expectations, the success of the first DIB in the world has immense implications for education policy and innovative financing instruments.

Impact Bonds are a new, complementary source of funding developmental interventions. Private sector firms undertake the initial investment by providing the upfront working capital to service providers to deliver programmes on the ground. Outcome payers — governments or development agencies — are obligated to repay the private firms’ investment alongside a fixed return if, and only if, pre-determined performance indicators are met.

Read the full article about improving girls’ education in Rajasthan by Shamika Ravi and Prerna Sharma at Hindustan Times.