Social Impact Bonds

Under a Social Impact Bond model, investors or donors provide upfront capital, while the state or municipality repays funds only if agreed outcomes are achieved. SIBs can serve as a catalyst for strengthening Ukraine’s social resilience, empowering municipalities, and enabling sustainable, community-led recovery.

In our work with municipalities, donors, and social organisations, we consistently encounter the same structural challenge: social problems are long-term and systemic, while financing is often short-term and fragmented.
Grants play a critical role in supporting Ukraine — and will continue to do so. At the same time, they rarely create incentives for:
- long-term accountability for results,
- transparent measurement of social impact,
- coordinated action between municipalities, service providers, and funders.
Social Impact Bonds introduce a different logic: payment for outcomes rather than activities. This approach can serve as a testing ground for a new governance model in social investment — one that prioritises results, trust, and shared responsibility.
This is precisely the opportunity we are currently exploring together with municipalities, international experts, and partners.

In 2025, with the support of Robert Bosch Stiftung, The Possible is conducting a feasibility assessment of Social Impact Bonds in Ukraine.
The core research question is practical:
Is it legally, fiscally, and institutionally possible to pilot outcome-based financing at the municipal level under current conditions?
As part of this work, we analyse:
- international experience with SIBs and related outcome-based models;
- Ukrainian legislation and available legal structuring mechanisms;
- public finance, budgetary, and treasury procedures;
- the role of local self-government;
- risks, constraints, and administrative burden.
The findings of this research are presented in a public report and related publications, available here.

We intentionally focus on the municipal level. Communities are the actors that:
- are responsible for the majority of social services,
- face the greatest pressure during recovery,
- have a direct interest in measurable and sustainable outcomes.
The proposed pilot model is designed to be realistic, safe, and learning-oriented, and includes:
donor-backed funding without expectations of financial return;
- clearly defined and measurable social outcomes;
- independent impact verification;
- gradual institutional involvement of municipal authorities.
Our goal is not scale at any cost, but institutional learning, legal validation, and trust-building — laying the groundwork for more effective social investment in Ukraine’s recovery.