Social impact bonds are unique public-private partnerships that fund effective social services through performance-based contracts. Impact investors provide the capital to scale the work of high-quality service providers. Government repays those investors if and when the project achieves outcomes that generate public value.

Whether they are focused on helping mothers experiencing poverty achieve healthy births, supporting immigrants and refugees through job training, or retrofitting homes, social impact bonds transfer risk from the public to the private sector and align project partners on the achievement of meaningful impact.

How it works


Repays investment if project achieves measurable outcomes

1 Partner


Develop and manage projects, mobilize capital, manage for results

2 Develop & Finance

Service Provider

Deliver high-quality services to improve lives

3 Deliver Services

People in need

Find opportunities to thrive through effective support

4 Attain positive results

Independent evaluator

Measure impact, triggering outcomes payments

5 Measure outcomes

Impact investors

Provide upfront funding and take financial risk

  1. Form partnership. Government identifies the social issue and the objective. To achieve the objective, they partner with an intermediary, like Social Finance, and high-performing service providers—organizations with track records of success and evidence that their programs work.
  2. Develop project and mobilize capital. Social Finance works with the government and the provider to drive the design, negotiation, and financial structure of the project. We then raise capital from impact investors to provide upfront, flexible funding.
  3. Deliver services. The provider delivers services to the target population, with ongoing support from Social Finance, including governance oversight, performance management, course corrections, and financial management and investor relations.
  4. Achieve outcomes. With the support of high-quality services, people in need achieve life improvements—having healthy births, raising children ready for kindergarten, staying out of prison, and finding and keeping good jobs.
  5. Measure results. An independent evaluator measures the impact of the project according to predetermined outcome metrics. If the project is successful, government repays project investors. However, government pays only at the level of outcomes achieved.

What is Pay for Success? >>

The first social impact bond was launched by Social Finance UK in 2010. There are now over 160 impact bonds across 28 countries, with more than 25 in the United States.

Countries with Impact Bonds

Social Finance Global Network Member

Contact Us

If you are interested in learning more about Social Impact Bonds, contact Vice President Nirav Shah.