「Pan-Impact Korea」 Launched & Completed the First Social Impact Bond(SIB) in Asia
■ Seoul SIB delivers intervention to BIF (Borderline Intellectual Functioning) children living in Seoul city child welfare facilities.
▷ BIF (Borderline Intellectual Functioning) children are those with Intellectual Quotient(IQ) level between 71~84, often recited as ‘slow learners’.
▷ Children with mild intellectual disabilities(IQ level between 64~70) possibly included in part should number of BIF children from welfare facilities found to be significantly small.
■ Pan-Impact Korea is the intermediary of the first SIB project launched in Asia. Intermediary takes the role of raising capital, hiring the service providers and managing the program overall. Founding members of Pan-Impact Korea have long been involved with the market by supporting the enactment of Seoul SIB Act and also proposing the first SIB project.
■ The innovative Seoul SIB model operates with investment capital paid by private investors (PPL; People and Peace Link, UBS Seoul; UBS Securities Pte. Ltd. Seoul Branch, MYSC; Merry Year Social Company) to the service providers (Daekyo Consortium; Daekyo Culture Foundation and Daekyo Co., Ltd).
■ Once the pre-determined objectives are verified to be met by the independent evaluator (Sungkyunkwan University), the commissioner (Seoul Metropolitan Government) repays the principal and the incentive based on the government savings accrued as a result of the program’s success level.
■ Seoul SIB is designed to help about 100 BIF children to develop and improve ability of independence over 3 years starting in August 2016.
Soon after the introduction of the first SIB in Peterborough, Pan-Impact Korea and Seoul Metropolitan Government moved forward to promptly apply the innovative SIB model for the city. The Seoul City Council passed the Seoul SIB Act in March 2014 to enable the operation of SIB project. After careful consideration, the council passed the first SIB project to be applied for children in need of desperate supports in April 2015. In July 2015, Pan-Impact Korea has officially been selected as the Seoul SIB intermediary and finalized contract with the commissioner in October.
The statistic shows that the probability of BIF children end up becoming welfare beneficiaries is 30%, which is 15 times higher compared to the children with IQ level above BIF range. In addition, BIF children will eventually become intellectually disabled as their IQ levels have a strong tendency to decline as maturational effects take place. They inevitably suffer from under-achievement and maladjustment to schools. Before the launch of the first SIB, there were neither social nor political supports available for these children. Without the Seoul SIB, they will continue to be neglected at the blind area from both government policies and public interests. All the research explains high correlation between basic learning skills and social adaptability, and provides ample reason for the necessity of this program.
Daekyo Consortium will provide intervention over 3 years to improve ① Cognitive ability and ② Sociality.
Independent evaluator will examine the level of achievement based on the following measurement index. The both criteria must be met simultaneously.
① Korean Wechsler Intelligence Scale for Children-IV (K-WISC-IV)
Weschler scale of intelligence test will be executed at the beginning and then again at the end of the program. IQ level improvements to the normal range (above 84) will be considered successful. ※ Children with mild intellectual disability will be considered successful should IQ level reaches the range of BIF (above 70).
② Korean Teacher’s Report Form (K-TRF)
Korean version of Teacher’s Report Form. Teachers in charge at schools evaluate and report children’s behavior twice a year. Results are released in numbers. The improvements on the scores would be counted as successful.
<Seoul Welfare Facilities Children Education SIB>
|Commissioner||Seoul Metropolitan Government|
|Project Intermediary||Pan-Impact Korea|
|Funders||– People & Peace Link
– Merry Year Social Company
– UBS Securities Seoul Branch
|Service Provider||– Daekyo Culture Foundation Consortium
(Daekyo Culture Foundation & Daekyo Co.)
|Project Duration||3 years|
|Target Population||101 Children with BIF (Borderline Intellectual Functioning; IQ 71~84) living in Seoul city child welfare facilities apart from parents
※ Children with Mild Intellectual Disability (IQ 64~70) will be served in part
|Predefined Targets||I. Improvement in Cognitive Ability
· Measured twice in total by Korean Wechsler Intelligence Scale for Children-IV (K-WISC-IV)
· Children with BIF to reach IQ level above 84 at completion
· Children with Mild Intellectual Disability to reach IQ level above 70 at completion
II. Improvement in Sociality
· Measured twice a year (6 times in total)
· Improvement in the average score of last 4 measurements compared to the average score of the first 2 measurements
|Maximum success payments||Investment principal + 25% interest|
The Result of the Project
The service provision was completed in the end of August 2019, and the evaluator submitted the result report in October. The result was a big success as it exceeded the maximum goal.
The first SIB in Korea was successfully completed as 52.7% of the beneficiaries succeeded, exceeding the maximum performance target by 10.7%p. Finally, Pan-Impact Korea received rewards from Seoul Metropolitan Government and paid the principal + 25% interest to the investors.
|Success (met both cognitive & sociality criteria)||52.70|
|Partial Success||Cognitive improvement only||9.46|
|Sociality improvement only||27.03|