UBS Optimus Foundation: Improving education in India


Photo courtesy of UBS Optimus Foundation

Development Impact Bonds: What are they?

A development impact bond (DIB) is an innovative form of social investment through which private investors such as the Coles-Medlock Foundation finance social improvement schemes, with the expectation of returns if the project successfully delivers on its targets.

If the programme fails to deliver the social improvements promised, no return is paid out. This enables governments and other major organisations to commission social improvement projects without shouldering any risk as they will only pay out for effective results.

DIBs have the potential to hugely improve the efficiency of public spending by shifting the risk from the public sector to private funders.

At the same time grant making organisations such as the Coles-Medlock Foundation benefit from potential returns, which would allow donations to be reinvested again and again in future charitable projects.

Charity: UBS Optimus Foundation

Project: The Quality Education India Development Impact Bond (DIB)

Grants: £100,000 in 2018

Key achievements:

109,152 children reached in 2018-19

40% of participating schools met or exceeded their targets for literacy and numeracy in the first year

30% more children achieving basic education outcomes

Overview:

With the support of the Coles-Medlock Foundation and other partners, the UBS Optimus Foundation launched the largest ever development impact bond (DIB) in education in 2018.

The Quality Education India DIB set out to improve learning outcomes for primary school aged children in India, helping them get closer to the literacy and numeracy levels appropriate to their age. To ensure maximum impact for the investment, the project focused on learning outcomes rather than measuring the number of children in schools.

Within the first year, 40% of the 600 participating schools met or exceeded their targets for literacy and numeracy meaning 30% more children achieved basic education levels. Working with three organisations in the states of Gujarat and Delhi – Kaivalya Education Foundation (KEF), Gyan Shala and the Society for All Round Development (SARD) – the DIB was rolled out through four education programs reaching 109,152 students aged five to 11.

Of the four programs, which ranged from training of school leaders to setting up new schools, three met or exceeded their learning outcome targets for year one while one fell short and was discontinued with the funds reallocated to the most effective programme.

A new scheme, Mindspark, was introduced in the second year of the DIB. It is a computer-based learning platform designed to close education gaps, with support provided to teachers on data, literacy and assessments.  The DIB set out to reach more than 50,000 additional students by the end of its second year with higher learning targets.

The DIB is paving the way for an outcome-based funding system that has the potential to improve the education and lives of hundreds of thousands of children across India.