Results-Based Financing (RBF) and Results in Education for All Children (REACH)

The REACH Trust Fund closed in June 2022.  We invite you to watch the virtual conference for key highlights and milestones of the program.

Over the last 20 years, governments and households have devoted ever increasing amounts of their national income to education. These investments have led to unprecedented increases in access, and more children are starting school earlier and staying in school longer than ever before. However, spending inefficiencies have meant that the increased investment in education has not so far led to large improvements in learning even in countries that have universalized access to basic education. Many factors underlie this problem, including poor student and teacher attendance, the failure of inputs such as textbooks to reach schools, and the use of education funding by schools for activities unrelated to learning.

 Results-based financing (RBF) holds out the promise of tackling spending inefficiencies and making more effective use of education resources. Results-based financing is an umbrella term referring to any program or intervention that provides rewards to individuals or institutions after agreed-upon results are achieved and verified. The approach has the potential to provide a stronger focus on the actions necessary to improve learning outcomes, foster local solutions to common education challenges, and strengthen the capacity of education systems to measure and track progress. However, these benefits arise from well-designed and well-implemented RBF programs. When interventions fail to meet these standards, they will have limited impact on reducing inefficiency and improving spending effectiveness. 

 RBF interventions have been used to incentivize many different actors and institutions within the education sector. Many countries have used RBF to provide incentives to children and their parents through conditional cash transfers and similar programs, with the aim of motivating students to attend and do well at school. Improvements in teacher attendance and teaching practice have been achieved using results-based financing to provide incentives to teachers. Some countries have also linked funding to school-level performance indicators to drive quality improvements. In decentralized countries, governments have experimented with incentivizing local governments and their officials by linking funding to subnational education results. RBF has also been used to tackle bottlenecks in different elements of education systems including book delivery systems.

Development agencies have started using results-based financing as a tool to improve the effectiveness of their aid to developing countries. In the education sector, many development agencies have begun to link development assistance to results in an effort to strengthen the efficiency and effectiveness of aid programs and ultimately to boost learning outcomes. The use of results-based financing in education is relatively new (the practice only began 10 years ago) and few programs have been evaluated. However, lessons on the design and implementation of programs are already emerging.

Interventions using results-based financing typically consist of more micro-level actions that are taken within the education system, such as the issuance of performance-based school grants and of teacher bonuses. These types of activities aim to change the behaviors of specific actors (e.g. , teachers) to help them focus more sharply on desired results (e.g., improving student learning).

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    Teacher Incentives

    Teacher incentive schemes reward good performance, seeking to boost learning outcomes by encouraging teachers to work harder in the classroom and in preparation. The right design is important to discourage “teaching to the test” and other potential problems.
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    School Incentives

    Some countries are encouraging schools to focus on improving student learning by linking funding to school performance. School incentives are less common in developing countries, and if not designed properly, can favor high-performing schools.
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    Student Incentives

    Giving cash incentives directly to students or their families can help ease financial constraints on poor households and underscore the importance of education. Adding conditions can boost enrollment and attendance rates–and ultimately, learning outcomes.

Approximately 400 million primary school-aged children around the world are unable to read proficiently. Evidence from many contexts shows that effective access to and use of textbooks and reading materials are one of the highest impact and most cost-effective ways of improving literacy and raising learning outcomes in developing countries. Yet many children do not have access to the reading materials they need to master basic literacy because of a lack of content in appropriate languages, inflated costs, inefficient supply chains, and ineffective use of books for improving early grade learning outcomes.

Results-based financing can help countries tackle these challenges by making book chains more efficient and, ultimately, ensuring that children receive quality books in languages they understand. While each country will face its own unique challenges, achieving this objective will require strengthening the book chain which includes: a) book forecasting; b) book development and production; c) book procurement; d) supply chain management and distribution; and e) book utilization.

Book Forecasting | Book Development and Production | Book Procurement | Supply Chain Management and Distribution | Book Utilization | Resources

Book Forecasting

The lack of data on the existing stock of books and on future demand limits the ability of school systems to forecast the book titles and numbers they will need for the upcoming school year. It also hinders the ability of education administrators to develop procurement plans, secure adequate and timely funding, negotiate with suppliers to reduce costs, pinpoint inefficiencies, and evaluate progress. Results-based financing can be used to address book- forecasting challenges by conditioning financing on the creation of an open-data system or a mechanism that supports and incentivizes improved use of available country data systems for book provision, resource mapping, gap analysis, and other related activities. Current REACH interventions in this category incentivize policy makers or local decision makers to improve their use of available country data systems for book availability and distribution to accurately project country book needs.

Learn More: Read how World Education is using results-based financing to implement Track and Trace and improve supply chain transparency in Cambodia.

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Book Development and Production

Many local and regional publishing houses are reluctant to publish relevant titles especially in underserved languages, due to limited financing, low demand, limited authorship capacity, and licensing and copyright issues. Stakeholders are experimenting with the use of results-based financing to incentivize publishers to develop relevant textbooks and supplementary reading materials in local languages as well as to expand access to already published titles. For example, Bangladesh is holding book competitions and awarding monetary and non-monetary prizes to incentivize authors and publishers to develop new titles in local languages, with the aim of bolstering the supply of relevant reading materials to support early-grade reading skills.

Learn More: Read how IREX implemented a results-based competitive approach to incentivize book creation in Bangladesh.

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Book Procurement

In the public sector, book procurement is not always optimized to guarantee the acquisition of good-quality books, value for money, or a regular and financially sustainable supply of textbooks and reading books. An analysis of 32 countries shows that textbook and learning material spending averages 2 percent of primary expenditures for low-income countries. At least part of the inadequate appropriation may be attributed to the fact that in some cases, actual budgets for textbooks and reading books consist of leftover funds rather than the result of an intentional, outcome-based, planning process. Ineffective procurement processes, along with fragmented and unpredictable financing, result in inefficiencies across the book supply chain. Results-based financing can encourage the use of best practices by education authorities, including relying on standard technical specifications for book procurement, developing pooled funding mechanisms, and ensuring that procurement processes achieve the largest possible print runs at the lowest costs.

Learn More: Explore how Room to Read is used results-based financing to develop a pooled procurement mechanism and to distribute more than 100,000 books to government schools in South Africa.

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Supply Chain Management and Distribution

Schoolchildren at Nkasaulo Primary School in Machinga District of Malawi, read their textbooks. The Machinga District is one of several that are benefitting from a program that ensures textbook delivery.
Poor supply chain management and inefficient distribution methods are often the major bottlenecks that countries face in getting books into the hands of children. Because book distribution may be centralized (coordinated by the Ministry of Education) or decentralized (coordinated directly by schools or districts) and involve a number of public, private, and NGO stakeholders, the book distribution process is complex. These complexities are confounded by weak transportation and delivery networks (including storage facilities, vehicles, and roads) that frequently leave books and other learning materials susceptible to damage, loss, and corruption. Such challenges are often exacerbated by a lack of accurate data or a comprehensive education management information system (EMIS), which can facilitate planning, delivery, and maintenance of necessary supplies of textbooks and reading books.

Results-based financing can be used to support supply chain management by incentivizing the development of results-based monitoring systems, like Track and Trace. Track and Trace is a technology platform that enables government, school-level, and other book distribution stakeholders to track the real-time ordering and distribution of books and other learning materials. It can put focus on known points of vulnerability along the book value chain, creating a transparent accountability process. Results-based financing could then be used to promote improvements along the chain, ultimately, making texts accessible to children. Current activities in this category incentivize the various actors and more efficient performance along the supply chain and have the potential to ensure that textbooks and supplemental readers are delivered to children in schools at the right time.  

Learn More: Read how World Education is using results-based financing to implement Track and Trace and improve supply chain transparency in Cambodia.

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Book Utilization

Reports show three key barriers to book usage: poor book quality, limited teacher training, and teacher reluctance to issue books to students. Even if schools have enough textbooks and reading books, this can impact learning outcomes only if the books are used appropriately in classrooms. For example, one study conducted in Uganda showed that despite the presence of textbooks in schools, students in 86 percent of classrooms did not actually use books. Results-based financing can be used to incentivize better teacher training on how to incorporate books into lessons and to undertake other campaigns aimed at motivating school-level stakeholders (teachers and students) to use books in the classroom.

Learn More: Can incentives to take home textbooks improve learning and book use in the Democratic Republic of Congo?

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    Government Use of Results-Based Financing in Education

    Many governments incorporate elements of results-based financing into their regular planning and budgeting processes. Increasingly, governments are seeking to align their medium-term education budgets with objectives outlined in their education sector's strategic plans. In a more direct approach, some countries are allocating resources to subnational governments and education institutions such as schools and universities based on performance or agreed- upon results. Some governments have also introduced specific results-based interventions within the education system to provide incentives to different actors or institutions and drive improvements in education outcomes.

    Evidence Base

    REACH is working to strengthen the knowledge base on government use of results-based financing through a number of initiatives. These include:

    • Research on interventions that use results-based financing to incentivize meso-level actors (e.g., district, provincial, or regional education officers). In 2017, REACH awarded five Knowledge, Learning, and Innovation (KLI) Grants to explore the potential of results- based financing to incentivize local government officials to use resources more effectively. The results from these grants are now available as Evidence Notes and have been presented as part of REACH’s Brown Bag Lunch series.
    • Country- or system-level studies that aim to assess the design, implementation, and impact of results-based financing programs in select countries, and to compare them with other approaches to education financing (e.g., traditional input-based funding). 
    • Analytical work that explores the experience of six countries that use results-based intergovernmental fiscal transfers to drive improvements in education.

    While results-based financing can be highly effective in the education sector, the approach comes with certain risks. A main risk for governments is that financing becomes less predictable, since disbursement occurs only after results are achieved. For donors, identifying goals that are attainable, impactful, and sustainable can prove challenging. And whenever funding is linked to an indicator, gaming and cheating become possibilities. Such challenges make it all the more critical for incentive programs to identify proper indicators and to include effective systems for verification.


     Gaming–the act of deliberately improving or otherwise manipulating performance measures–is always a possibility when financing is linked to an indicator, and even the most well-designed systems can be plagued by such problems. If a teacher bonus is tied to student test scores, for example, the teacher may provide answers to students or teach to the test, or schools may even change students’ scores outright. The use of incentives tied to specific results can also result in the neglect of other priorities or lead to other unintended consequences, such as teachers focusing their efforts on more promising students at the cost of slower learners. The likelihood of strategic or gaming behavior tends to increase the higher the stakes are, the longer the intervention has been operating, and the less able recipients are to influence outcome. Even as it is difficult to prevent gaming, some strategies can help to discourage the practice, such as including several verifiable metrics or setting targets that are conducive to learning or that help build capacity, instead of linking aid to specific inputs or outputs.


     It isn’t always easy to know which indicators are the “right” ones in any development financing project, but indicators in results-based financing carry more weight because the disbursement of funds occurs only after the indicators are achieved. Results-based indicators must strike a balance between cost, effort, feasibility, and ambition. World Bank education projects typically use four types of disbursement-linked indicators: input (e.g., set number of textbooks delivered to school), process (an effective curriculum put into place), intermediate (number of schools inspected with reports published on government website), and outcome (demonstrated improvement in student test scores). Few of these projects adopt inputs or outcomes as indicators; any indicators related to traditional inputs tend to focus on quality aspects, whereas outcomes, while providing benefactors with independence, can be hardest to achieve. Given how difficult it can be to identify a clear formula that leads to strong learning outcomes, it is helpful to understand the results chain when deciding on the best disbursement-linked indicators. Many projects tend to concentrate efforts “further up” the chain, focusing on intermediate outcomes and even process inputs and indicators, such as capacity building. Other factors to consider when selecting indicators: the timeframe of the project and pricing, including the ability of an indicator to unlock processes and progress beyond its direct value.


     Results-based financing, by its very nature, depends on the verification of results. Without credible systems that can evaluate whether a target or result was attained, results-based financing will not work. Thus, resources should be set aside to guarantee that results can be reported and verified, whether by strengthening existing systems for data collection and reporting, auditing, and evaluation, or providing for independent verification of results. There are various ways to collect and report data to monitor the achievement of indicators. Generally, if government information systems and administrative data are available–such as through a country’s education management information systemthis can offer the cheapest option, as long as the data are reliable, accurate, and up-to-date. An alternative is to create a parallel structure to gather the necessary data. While this may be more reliable than working with existing systems, it can be a missed opportunity to strengthen in-country capacity, whether of a school, a district government, or a national-level ministry.

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    Results in Education for All Children (REACH) seeks to help countries strengthen their education services by focusing programs and initiatives on results, with the ultimate goal of boosting learning outcomes especially among the most vulnerable populations.

    Established in 2015, the World Bank program funds results-based financing projects and provides technical support and advice on results-based financing in education to other World Bank teams and development partners. One of its main goals is to contribute to the evidence base around results-based financing in education, gathering data and knowledge that can be used to develop better education programs and policies, with the goal of boosting education outcomes.

    REACH is funded by the Government of Norway through NORAD, the Government of the United States of America through USAID, and the Government of Germany through the Federal Ministry for Economic Cooperation and Development.

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      REACH Knowledge, Learning, and Innovation (KLI) Grants support results-based financing projects targeting education systems in low- and middle-income counties, with the goal of increasing understanding of how this strategy can boost learning. As of 2019, REACH had awarded 37 grants in two dozen countries.
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      Publications and Other Resources

      In line with the World Bank’s Education Strategy 2020, REACH supports the institution’s efforts to build evidence and operational knowledge on results-based financing in education through its grant programs and knowledge sharing activities. The information is published in papers, reports, notes, and other knowledge products that address RBF design, implementation, and monitoring, as well as the ways that a results-based approach can strengthen education systems and outcomes.
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      REACH hosts a variety of events each year, including round table discussions, workshops, and panels, with the dual aim of educating people on results-based financing and consolidating knowledge on the approach. REACH brings together experts to share their knowledge and experience in the field, and trains World Bank teams to leverage the strategy to achieve better results in education outcomes.

    In line with the World Bank’s Education Strategy 2020, REACH supports the institution's efforts to build evidence on and operational knowledge of results-based financing in education through its grant programs and knowledge-sharing activities. The information is captured in a knowledge suite of products on the evidence, lessons learned, and impact around the use of results-based financing. These products offer different levels of knowledge for different purposes and audiences from practitioners to policy makers, and they range from a broad review of the use of results-based financing in education (“RBF review”) to several notes series to blogs and videos.

    Click here to access the RBF Education Knowledge Suite.