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Blog » Have Development Impact Bonds Moved Beyond the Hype?

Have Development Impact Bonds Moved Beyond the Hype?

Created Jul 18 2016, 12:00 AM by Dilshod B. Yusupov
  • Education

When development impact bonds were first discussed about three years ago, there was quite a bit of excitement and hype about their potential. While some of that enthusiasm may still exist, the intervening years and initial experiences of trying to launch DIBs have brought expectations down to earth.

Development impact bonds begin with an investor, who provides the upfront capital for an intervention — be it improved education or a reduction in malaria — carried out by a service provider. If the program achieves specific, closely-measured results, then an outcome payor — in the case of development impact bonds, usually a foundation or donor agency, though it could be a private corporation as well — pays the investor based on how well the intervention succeeds.

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