Social impact bonds have caught the attention of at least a dozen governments in high-income countries such as the UK, the US, Australia, and Canada. Yet discussions around the use of this innovative performance contract for international development in emerging economies have started relatively recently. My own social enterprise, Instiglio, which I founded with my partners Avnish and Michael, has been making some progress in this space. There have recently been two major developments in this space that are worth reviewing:
1. The creation of the Development Impact Bond Working Group. Social Finance UK, which structured the world’s first social impact bond over in England, and the Center for Global Development, which had been the intellectual champion behind the Cash on Delivery model, created a working group that is comprised of top officials from leading development agencies and is tasked with exploring the application of social impact bonds in emerging economies. This group has released information about two meetings (here and here) and created web pages to track its progress (here and here).
2. International development agencies have formally and informally expressed interest in social impact bonds. First, the Canadian International Development Agency has released aproposal to study the application of SIBs to access to finance. Second, DFID and Social Finance UK conducted a scoping study of a SIB for family planning. Third, the Inter-American Development Bank, the Asian Development Bank, several other development finance agencies have started internal discussions around the social impact bond model.