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Why we believe in Results-Based Financing

Created Apr 17 2017, 12:00 AM by Dilshod B. Yusupov

We just got back from Nepal to see how results-based financing has, or hasn’t, changed the way their education system functions. Over lunch, we asked our counterparts at the Ministry of Education: “What’s been different since the introduction of results-based financing?” Their response: “Oh, we just pay more attention to the indicators.” While this may sound peripheral, it speaks to the power of RBF.

For us in education, RBF is a financing tool that governments can use to strengthen country education systems. This stands in sharp contrast to others who may view it primarily as a way to generate more value for money, or – ultimately – in hopes of achieving ‘smarter aid’.

In our Nepal example, our counterparts’ answer reinforces the idea that RBF can, and does, work to improve country systems. “Paying more attention to indicators”, in this case, has meant that the Ministry of Education needed to upgrade their Education Management Information System (EMIS), such that the data be more robust. It has also forced them to check assumptions when predicting targets, and to be more precise when calculating them, resulting in more reliable data systems that are of greater use to school directors, district officers, and policymakers.


Linked to this, their answer also signals that RBF has the ability to shift things so that everyone both knows about the shared results and makes the effort to measure them. The experience of Nepal is much like others around the world: Dominican Republic; Jamaica; Mozambique; and Pakistan, just to name a few.


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