Social impact bonds. Pay for performance. Cash on delivery. Your eyes may already be glazing over, and you may be thinking — “Here someone goes with complicated, shiny new toys thinking they’re going to revolutionize development.”
While any innovation can be overhyped, beneath the many names and faces of results-based financing, or RBF, is a simple and powerful concept: Tying payment not just to outputs but to actual results.
While nascent, RBF is supported by a growing body of practice and evidence that demonstrates when and how it can add value. It can drive impact by drawing attention to results, aligning incentives to those results, providing flexibility, and holding providers accountable to beneficiaries.