Utkrisht Impact Bond Case Study
The Utkrisht Impact Bond will support private healthcare facilities in Rajasthan, India to achieve and sustain a standard of quality that will result in decreased maternal and newborn mortality. Funding will be provided to Population Services International (PSI) and Hindustan Latex Family Planning Promotion Trust (HLFPPT) to support private healthcare facilities attain the level of quality that enables them to be certified under a joint quality standard (JQS) consisting of the Manyata initiative, a new national certification and quality improvement system to recognize private facilities who consistently deliver quality care to the women they serve; and the National Accreditation Board for Hospitals (NABH) Small Health Care Organisation entry-level certification. The impact bond will be managed by Palladium. The upfront funding to carry out activities will be provided by UBS Optimus Foundation using UBS client’s funds, alongside co-investments from the implementation partnership comprised of Palladium, PSI, and HLFPPT. The investors will be remunerated by the outcome funders, Merck for Mothers and USAID, if facilities achieve the quality standards required to be certified.
The impact bond contracts were signed in November 2017, with implementation to begin in early 2018 – just under two years after all key parties were brought together for the first time. Convergence provided a grant to Palladium in mid-2016 to complete structuring activities and launch the impact bond. The design process provides learnings for developing multi- stakeholder financing structures, in particular, impact bonds.
This case study outlines a number of key insights that may be useful for practitioners interested in establishing impact bonds, as well as for funders interested in supporting these mechanisms. As with all tools, the prioritized interventions should determine the appropriate funding mechanism. Outcome funders and investors should be engaged early in the process, and significant delays should be incorporated into work planning given inevitable challenges in achieving consensus among a diverse group of partners.