Revolutionizing Outcome Based Financing For Indian Non-Profits

Updated: Saturday, December 16, 2023, 9:13 [IST]

Parinaam, an ecosystem platform to support outcome-based financing of innovative and scalable development projects, was launched at a major convening held in New Delhi held on December 8th at the India Habitat Centre attended by over 300 non-profit leaders, impact funds and foundations, investment intermediaries and policymakers. The event was headlined by senior government representatives including Dr. R Balasubramaniam (Chair, Social Stock Exchange), Dr. Shamika Ravi (Member - PM's Economic Advisory Council) and Shri. Ajit Kesari (ACS - Finance, Govt. of Madhya Pradesh) as well as well-known names in global development economics and Indian philanthropy including Mr. Nitin Desai (former UN Under Secretary General) and Mr. Ashish Dhawan (Founder, The Convergence Foundation) among others.

Parinaam, which means 'result' or 'outcome' in Hindi, introduced the concept of outcome-based financing, or funding development projects using philanthropy or public capital only when tangible results are demonstrated on the ground by non-profits engaged in program delivery. This has been a global movement pioneered by several leading foundations and has been adopted in India through what are known as Social and Development Impact Bonds (SIBs or DIBs) as well as other financial instruments. It has multiple benefits in unlocking new sources of philanthropy or risk capital, providing greater flexibility to service delivery organisations, and, most importantly, ensuring accountability of funds spent. The movement has gotten further fillip with the development of the Social Stock Exchange under SEBI which has recently seen the first NGO listing on the NSE and soon expects to see other instruments including SIBs.

Revolutionizing Outcome Based Financing For Indian Non-Profits

The Parinaam summit was organized by Desai & Associates (D&A), a social finance advisory and ecosystem development firm, in partnership with co-convenors Asha Impact, a non-profit trust supported by leading business leaders, and Impact Verse, a tech platform for NGOs. The knowledge sessions were supported by over a dozen foundations and ecosystem enablers including the Indian Impact Investors Council (IIC), the Indian School of Development Management (ISDM), and British Asian Trust (BAT) among others. The conference involved various formats beyond plenary discussions including case studies of NGOs who have used outcomes finance, fireside chats on key legal and policy issues, and expert workshops to train non-profits. Most importantly, a closed door roundtable discussion was attended by over 75 senior leaders representing NGOs on one side and funders from foundations, impact funds, CSR and HNIs on the other, to have a dialogue on the challenges and potential solutions to unlock more capital for development.

Parinaam is not a conference but a platform that, going forward, will act as a knowledge hub, ecosystem enabler and convenor for all issues related to outcomes-based finance, and works in a highly collaborative approach with stakeholders who have built the market in India. Prior to the summit, a Masterclass (webinar) was held where over 500 NGOs participated in training sessions with experts from the Bombay Stock Exchange, Michael & Susan Dell Foundation, Trilegal, Villgro Innovation Foundation and Bridges Outcomes Partnerships. Immediately post the conference, Parinaam has announced partnerships with the Asian Venture Philanthropy Network, co-hosting an investor roundtable at AVPN's South Asia Summit in Mumbai on December 13th; with ISDM, which is producing a report on NGO perspectives and online database of non-profits to be hosted on the Parinaam platform; and with its lead convenor D&A, which will be hosting a range of policy dialogues on development finance.

KEY QUOTES

"Outcomes based finance has an important role to play in development. Solutions don't sit with funders, with government, or with scholars. They sit with you - the NGO."

- Dr. Shamika Ravi, Member of the Prime Minister's Economic Advisory Council

"The Govt. of Madhya Pradesh, with the support from NSE, USAID, D&A and IPE Global, have narrowed down to four possible areas for outcome based funding. If we succeed in a model where payouts are linked to achievement of specific outcomes, this will change the way development is achieved."

- Shri Ajit Kesari, ACS - Finance, Government of Madhya Pradesh

"To shift the social sector to an 'outcomes-first' approach and strengthen sustainable development in India, it is critical for NGOs to build their internal capacity, domestic funders to allocate capital and intermediaries to build templates and create evidence."

- Ashish Dhawan, Founder, The Convergence Foundation

"The Parinaam platform intends to involve key stakeholders in the development sector, including government, funders, NGOs, policy makers, to come up with an agreed strategy and framework on outcome based financing."

- Shri. Nitin Desai, Former USG, United Nations & Former Chief Economic Advisor, Govt. of India

"Parinaam is the start of a collaborative movement. It's not a typical conference but an ecosystem building platform for driving funding to India's social sector, fostering tri-sector collaboration between sarkaar, samaj and bazaar, and democratizing access to knowledge and data on blended and outcomes finance for any citizen of India interested in this subject."

- Kartikeya Desai, Founder, Desai & Associates

For more information please visit: www.parinam2023.org

Videos of sessions and interviews with speakers: https://www.youtube.com/@desai-associates/

For greater understanding of what is outcome-based finance please refer to the Masterclass PPT and Session Recordings from the Masterclass (Webinar) on outcome-based financing for NGOs: https://parinaam2023.org/masterclass