What is the size and scope of the impact bonds market?

This brief examines the size and scope of the global impact bonds market. It explores impact bonds’ growth trajectory since the launch of the first one in 2010, the current size of the market, and their geographic and sectoral spread. It also analyzes drivers of growth and barriers to scale, and posits the potential for the future of impact bonds and outcome-based financing more broadly.

Based on the Brookings Global Impact Bonds Database, the brief explains that 194 impact bonds have been contracted in 33 countries across six sectors. This represents over $421 million in upfront investment in social services and $460 million in total outcome funding committed. A few countries stand out as the largest markets for impact bonds: the United Kingdom, the United States, the Netherlands, Portugal, and Australia; India is the developing country with the most contracted impact bonds. While it is challenging to identify an appropriate benchmark for comparison purposes in terms of size or scale of the market, relative to the outsize gaps in quality service delivery across the globe, it is quite small.

Nevertheless, in high-, middle-, and low-income countries alike, efforts are underway to scale outcome-based financing more broadly through consolidation of investment and outcomes funding for a range of intractable societal challenges.