Our

VISION

To bring together service providers investors and funders to set-up scalable outcomes focussed solutions addressing India’s pressing education challenges.

Our

MISSION

Create transformational impact in Indian education through funding USD 1 billion of outcomes-focused activity

India has made significant gains towards providing access to education. However, it is currently facing an unprecedented learning crisis. Most Indian children perform below grade- level in both literacy and numeracy, which leads to reduced life chances and poor employment opportunities.


of grade 8 students in India
cannot read a paragraph of text.



of grade 2 students are not able
to perform simple subtraction.



of grade 2 students are not able
to perform simple subtraction.



India currently spends 2.7% of GDP on
school education, labeled both “insufficient”
and “inefficient” by the World Bank.



Of this budget, 34.5% is spent on
infrastructure and remaining is spent
on teacher salary.


This leaves little room to correct for quality in key areas of remedial education, non- academic development, curriculum development and teacher professional development. The government has struggled to improve the quality of public education.

India Education Outcomes Fund (IEOF) is a visionary fund that aims to create an ecosystem of sustainable funding by bringing together the government, donors, investors, and service providers to work together towards a common set of learning outcomes to channel $1 Billion towards improving learning outcomes and delivering on India’s Sustainable Development Goal of ensuring “inclusive and equitable quality education and promote lifelong learning opportunities for all” by 2030.

The IEOF will support improvements in the quality of education, with a razor focus on programmatic outcomes. All programs will be designed to ensure they are:


Scalable



Measurable



Impacting education outcomes and/or life-chances


The IEOF will measure what works in the following areas:

Early Childhood Education Foundational Learning Skills Secondary Learning School to Workforce Transition Skills training & specialized courses in healthcare, technology and supply chain

VALUE

PROPOSITION OF IEOF

IEOF is not an individual impact bond provider.

IEOF is an outcomes fund focused on long-term systemic change. It will structure and launch multiple impact bonds or pay-for-success contract in parallel and at scale (across the five focus areas- ECE, primary, secondary, school-to-work, and inclusive) to achieve a set of pre-defined outcomes while reducing transaction costs and risks often associated with individuals impact bonds.

Benefits of moving to this approach include:

  • Centralised contracting capability: Build a better understanding of contracting for outcomes, and provide a focal point to develop contracting expertise as well as lowering transaction costs.
  • Integrated, coordinated interventions: Allows for an integrated, holistic approach to addressing social challenges, and coordinated funding for multiple providers based on an overarching strategy aligned to Government priorities.
  • Sustainable funding: Act as a longer-term source of funding, providing increased stability and capacity to delivery organisations.
  • Knowledge-building: Act as a platform for knowledge-building beyond one-off projects, which can have significant influence in informing future policy and approaches

The ultimate goal of IEOF is to migrate towards a “rate card approach,” another paradigm shift in how social programs are financed in India.

WHY DO WE NEED

A NEW APPROACH

Way too often, non-state actors fund education organizations in a fragmented and restrictive manner, that is not aligned to the national agenda. At Social Finance India, we believe that in order to create significant social change, and we need to facilitate technical experts to work at scale in conjunction with government priorities. We believe that fragmented philanthropic funding will not achieve India’s national achievement goals.

India’s education budget is less than half of what is needed

to successfully meet the SDG’s. Without significantly more and better funding, we pose a significant threat to realizing the capacity of India’s population dividend.

01

State government spending is earmarked

for teacher salary and administrative costs, leaving little capacity or capability to invest in system remediation. However, when aligned with government policy and properly regulated, non-state service providers can bring much-needed innovation, agility and capacity to the education sector, both in delivering education and providing ancillary services.

02

Non-state providers work at a small-scale

relative to the size of the problem and, there are multiple small streams of non-state interventions that cannot fix the larger issue at scale. Government must take the lead in delivering and financing inclusive, quality education for all.

03

There is inadequate attention to skilling the ecosystem

around the school to address education challenges; all stakeholders around the school need to be accountable for education outcomes. Funding and programming for Service Providers today are often highly fragmented. Restrictive grants prevent social entrepreneurs from adapting to conditions on the ground.

04

Philanthropic giving focuses on delivery over design

and funds flow through a flat structure which makes it difficult to correct course once a program is underway. Donors lack transparency into which interventions work best, and their relative cost-effectiveness. This system of funding is too often holding back the results we can and must achieve

05

Government bureaucracy makes it a challenge to scale programs

and requires alignment and capacity across stakeholders to do so. For many (but not all) types of impact, outcomes funds can ensure that scarce public and philanthropic funds are only used for programs that achieve the desired results

06

Indian education sector and skilling needs a new partnership model centered on success, that will:

Build capacity
of service providers

through enhancing delivery readiness and absorptive capacity to deliver quality programs at scale, with robust data management, reporting, leadership and delivery mechanisms

Build transparency
and adaptability

in the implementation of education programming to allow for data-driven flexibility in program delivery.

Build a knowledge
and data repository

from independent third-party outcome assessments of funded programs to disseminate widely and inform future design through identifying innovative and effective programming.

Catalyze
innovative finance

to reduce transaction costs of education programs at scale through a portfolio of impact bond products to collectively channel $1 billion in to education program delivery.

Mobilize
government resources

to create sustainable, main-stream systems.

OUR

STAKEHOLDERS

Outcomes Funders

Come together to deepen their impact by paying for long-term, sustainable outcomes, after they are achieved – transferring delivery risk to the private sector, and improving overall program performance and value for money.

Investors

Provide upfront working capital investments where required, and support the education organizations to build capacity and deliver better results. They achieve a measurable impact, as and when an uncorrelated financial return.

Education Organizations

Work with a new rigor to deliver to outcomes (rather than inputs) – with the flexibility and support to innovate and adapt based on what is working on the ground, in collaboration with other providers.

Government

Will be a key partner in every project, ensuring funding and programs are aligned with their policy priorities. They will co-fund outcomes, support enabling environment, and with our support build capacity to commission for outcomes.