Is your program suitable for a social impact bond?

Is your program suitable for a social impact bond?

A practical guide to help you self-assess your program’s appropriateness for a social impact bond (SIB).

The social impact bond (SIB) innovation is gathering pace around the world and here in Australia, but it is still very early in the development of this nascent market. Expectations are high – from investors and service providers alike – but implemented contracts are thin on the ground, and players are learning on the job when new SIBs are developed. …the reality is that they are not a suitable funding instrument for all social programs. With two state governments having taken their first steps in trialling SIBs, many organisations are actively considering whether a SIB would suit their program. The allure of long term, large scale funding for a program is understandable, however there are many stars that need to align for a SIB to be viable. While SVA believes SIBs have the potential to provide significant benefits to governments, service providers and investors alike, the reality is that they are not a suitable funding instrument for all social programs. This article provides key questions that organisations thinking of embarking on the SIB journey should consider, and viability ‘rules of thumb’ for those questions.

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