Social Impact Bonds

SOCIAL IMPACT BONDS: OUTCOME-BASED FINANCING BY GOVERNMENTS

Social impact bonds, referred to as results-based financing, are a new financing tool that uses private capital to achieve positive social outcomes while simultaneously generating cost savings for local governments and financial returns for investors. Social impact bonds partner local governments with private investors in deals that require a government to pay out only if a social services group can meet a specified performance goal. This is a ‘Payment-by-Results’ (PbR) mechanism.

 

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