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The Bank of Punjab has partnered with government and international partners to issue Pakistan’s first-ever Skills Impact Bond (PSIB) worth Rs 1 billion, a results-based financing instrument designed to boost youth employability. It shifts funding from traditional input-based models to private capital tied to measurable outcomes like job placement and sustained employment.
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The Pakistan Skills Impact Bond (PSIB), backed by a sovereign guarantee from the Ministry of Finance and developed with the British Asian Trust and National Vocational and Technical Training Commission NAVTTC, represents a paradigm shift in social impact financing by linking investor returns to independently verified milestones, such as certification, employment and job retention. Under the “pay-for-success” model, upfront investor funds are channeled into high-impact skills training programmes aimed at closing critical skills gaps, fostering economic participation and enhancing women’s workforce inclusion.
The PSIB has drawn strong international support, including contributions from the UK’s Foreign, Commonwealth and Development Office (FCDO), highlighting confidence in Pakistan’s innovative financing approach and its potential to scale. Executives from The Bank of Punjab said the bond’s success will create a blueprint for future impact-oriented instruments in priority sectors like education, healthcare, and economic development, while government leaders framed it as central to unlocking Pakistan’s demographic dividend through scalable, outcome-driven investment.
By aligning private finance with measurable social outcomes, Pakistan’s first Skills Impact Bond could redefine how human capital development is funded and monetized, turning demographic potential into durable economic gains.
