Capital Alone Won’t Deliver Impact
By Hitan Mehta – Chief Executive, British Asian Trust
Recently, I joined leaders from government, philanthropy, development and finance at the FCDO Global Partnerships Conference in London, including a closed-door roundtable on outcomes-based financing. Across many of the conversations, one theme kept coming up: development partnerships are changing fast.
As Official Development Assistance (ODA) budgets come under increasing pressure, there is growing focus on investment-led approaches, outcomes-based financing and mobilising private capital to drive social impact at scale. There is real potential in this shift. Better financing models can help unlock innovation, strengthen accountability and bring new partners into development.
But one thing struck me very clearly during the discussions - modern partnerships need more than capital.
At the British Asian Trust, we work closely with organisations delivering change on the ground across South Asia. These organisations often have deep community trust, strong local knowledge and proven delivery expertise. But many are now being asked to operate within increasingly technical financing systems that were not designed with them in mind.
Too often, participation in innovative financing models depends not just on the quality of delivery, but on whether organisations have the cashflow, data systems and reporting infrastructure required to navigate complex outcomes-based models.
That creates a real risk. If we are not careful, the organisations closest to communities could become excluded from the very systems intended to scale impact. The danger is not that development becomes more investment led. The danger is that technical sophistication around financing structures starts to matter more than delivery expertise, local trust and contextual understanding.
This is something we have been thinking deeply about through the British Asian Trust’s Outcomes Readiness Programme, which helps strengthen capabilities around data, governance, performance management and results measurement. Because if the sector is moving from funding activities to financing outcomes, then building organisational readiness matters just as much as mobilising capital.
It also has implications for how these financing models themselves are designed. Too often, payment structures assume organisations can absorb significant delivery risk and wait long periods for reimbursement. In practice, that can unintentionally exclude smaller or locally rooted organisations that may have the strongest delivery capability but lack the balance sheets to sustain long payment cycles.
If we want broader participation from social sector actors, then financing structures need to reflect operational realities on the ground. That may mean incorporating earlier milestone payments or shift indicators alongside longer-term outcomes, allowing organisations to access funding earlier while still maintaining accountability for results.
It also raises important questions about localisation. Localisation is not only about who delivers programmes. It is also about who is able to participate meaningfully in the financing systems shaping the future of development.
The future of partnerships will not be defined simply by how much money we mobilise. It will depend on whether we can build financing systems that organisations closest to delivery are genuinely able to access and operate within. That means combining scale with accessibility, innovation with operational reality, and financing models with the practical needs of the organisations expected to deliver them.