Impact Bonds - ELI5

First of all, know that Impact Bonds have nothing to do with traditional “bonds” (fix interest financial instruments).

By Impact Bonds it is meant anything under that category:

  • Social Impact Bonds
  • Development Impact Bonds

Impact Bonds are generally in the sustainable development space: social, environmental & economical development.

The definition of the impact bonds (social vs development) depends on who pays the outcome:

  • Dev Impact Bonds —> development partners like philanthropic foundations are taking part
  • Social Impact Bonds —> generally financed by governments

Read more about each term:


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