WASHINGTON — The International Committee of the Red Cross announced the launch of the world’s first Humanitarian Impact Bond on Friday, aiming to raise 26 million Swiss francs ($27.3 million) to build and operate three physical rehabilitation centers in conflict-affected parts of Africa over the next five years.
While social impact bonds and development impact bonds have been around since 2010 and 2015, respectively — providing a new way to finance social services and development projects — ICRC’s scheme is a first for the humanitarian sector.
The model offers a type of results-based financing, since the ultimate funders only pay back the investors in full if the project is deemed a success. Institutional and private investors will put up the money needed for the physical rehabilitation project, establishing centers in Mopti, Mali; Maiduguri, Nigeria; and Kinshasa, Democratic Republic of Congo, to support those injured by violent conflict, disease or accident.
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