Five Myths About Impact Bonds

This report debunks five common myths surrounding impact bonds, clarifying their nature and practical application in development finance. It explains that impact bonds are not traditional financial bonds but rather results-based financing mechanisms that link payments to the achievement of pre-defined social outcomes. The paper addresses misconceptions about new money, suitability for organizations, and risk allocation, providing a more accurate understanding of how these instruments can drive innovation and shared responsibility in social impact initiatives.