Promoting Innovative Options for Financing Urban Sanitation
Most assessments of sanitation finance suggest that there are large funding gaps in the sector. State and Central Government funds have not been very effective in achieving the set goals and outcomes. CWAS has been actively engaged in the discourse of leveraging alternative sources such as Corporate Social Responsibility funds, Crowd Funding, Public-Private Partnership arrangements and Social Impact Investments for urban sanitation financing. The Center is part of national and international level forums working on exploring and scaling up these options and also strengthen the use and outcome effectiveness of Government funding.
The Center has been working on exploring Development Impact Bond for urban sanitation particularly Faecal Sludge and Septage Management. It is an innovative financing mechanism that focuses on outcomes, ensures implantation of strong monitoring systems, collaboration among different partners, and has the potential to attract social investors towards sanitation space. It has outlined a model DIB structure for safe collection, transport and treatment of faecal sludge from all households including low-income households. It considers the role of multi-stakeholders including private service providers, local government, investors and outcome funders. Under this model, key measurable outcomes are developed and linked to repayment to investors. A secondary matrix for environmental impact of improved sanitation is also developed. It is envisaged that success of this pilot DIB in urban sanitation will act as a model case for future potential investors.
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