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Case Study: Educate Girls Development Impact Bond

In this case study you will learn how impact bonds are designed and implemented.
Educate Girls DIB Structure
© Asha Impact
In India, 3.7 million girls are out of school – 42% because of their parents. 47% of girls in grade 5 cannot read a paragraph, 30% of children in grade 5 cannot do simple subtraction.
These facts highlight an enormous challenge which India is currently facing. When you know that an educated girl is more likely to earn 10% more and consequently increase the country’s GDP, get married 4 years later, have fewer but healthier children, survive pregnancy and childbirth, and send her own future children to school, it is obvious that this problem had to be addressed.
The above context created a strong opportunity for a Development Impact Bond (DIB) in rural Rajasthan. While Educate Girls had always raised grants to conduct operations in Rajasthan, Safeen Hussain, founder of the NGO, was keen to experiment with the innovative instrument to continue delivering quality at scale and value to every single child impacted through its programme.
We suggest you visit the Educate Girls official website to learn more about the work of Educate Girls and the world’s first DIB in Education. Here is some basic information.
The objectives of the DIB were two-fold:
  1. Increase the enrolment of girls and improve learning outcomes for 7,300 children in rural Rajasthan
  2. Develop and demonstrate a financing mechanism that incentivises ambitious results
Once the objectives were set, the Educate Girls team had to design the approach. They decided to try to achieve the above objectives through two main interventions:
  1. Enrolment: Identification of out-of-school girls, increase parent awareness about the value of schooling, engagement to improve attendance and prevent drop-outs. The target population was made up of girls ages 7-14 that were eligible for enrolment into grades 2-8. The results would be simply measured by calculating the percentage of out of school girls who have been enrolled into government schools.
  2. Learning: Volunteers would language and Mathematics to girls and boys in grades 3-5. Volunteers (educated young adults in rural Rajasthan) were incentivised with career development opportunities. The results of this objective would be measured using the ASER test.
Another important part of a DIB is to agree on how the total payment will be allocated to the target outcomes. In the case of the Educate Girls Development Impact Bond, 20% of the total outcome payment was assigned to the first objective (enrolment), and 80% to the second one – learning.

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The final results clearly over-exceeded the expectations. The Educate Girls DIB reached 7,300 children, covering 166 schools across 140 villages. In other words, it achieved 160% of the learning target and 116% of the enrolment one. Thanks to these highly positive results, the investor UBS Optimus Foundation recouped its initial funding plus an extra 15% Internal Rate of Return from the outcome payer, the Children’s Investment Fund Foundation (CIFF). In summary, the Educate Girls Development Impact Bond delivered impressive results and surpassed both target outcomes.
Do you still have questions regarding the Educate Girl Development Impact Bond? Or about the structure and idea behind Social Impact Bonds?
© Asha Impact
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