Authors: Milena Castellnou, Daniella Jammes and Hilary Sienrukos
Policy Area: Procurement
Results-Based Financing (RBF) is attracting interest as an innovative way to fund social programs in order to improve the effectiveness of spending, enable innovation in service delivery, and promote partnerships between the public sector, nonprofit, and private entities. However, lengthy design processes and high transaction costs are often mentioned to explain the reluctance of organizations to adopt this financing mechanism. Little attention has been paid to the procurement and legal challenges faced when structuring RBF programs. This report highlights some of the main challenges when contracting for RBF, and suggests best practices for lawyers and procurement officials.