Paying to Improve Girls' Education: India's First Development Impact Bond
In 2013, Educate Girls (an Indian nonprofit working to increase the number of girls enrolled and learning in school), partnered with Instiglio, a startup specializing in financial instruments for social programs in developing countries to create the first Development Impact Bond-a financial instrument similar to a Social Impact Bond. UBS Optimus, a Swiss foundation, agreed to act as the investor and the London-based Children's Investment Fund Foundation would reimburse UBS Optimus' initial investment and pay returns if Educate Girls met or exceeded a set of predetermined goals. Instiglio would broker the deal and IDinsight, a new evaluation organization would conduct the evaluation. Agreeing on the evaluation design, however, proved challenging. An evaluation was vital to the DIB because success payments hinged on its findings, but Educate Girls was concerned that the investors and evaluators were not considering the realities of program implementation when proposing complex evaluation methods. Whereas, the investors and evaluators were not interested in backing a DIB where the impact findings could be open to question.