The Challenge
Assam faces a dual challenge: a growing demand for skilled workers to meet its economic ambitions, and persistent barriers that keep youth, especially women and low-income students, from accessing quality training. Traditional skilling programs often emphasise enrolment over employment, and funding is typically tied to inputs rather than verified outcomes, leaving many graduates without jobs. A newly set up state-level skills university aims to address this gap and aims to train 50,000 youth over the next decade as a multidisciplinary hub for high-quality skilling. Its goal is to increase employability, reduce out-migration, and expand opportunities for women and students from economically weaker sections. To realise its vision, the university needed innovative financing models that could link funding to results and attract private capital alongside public resources.
Blended Finance in Action
TBFC, in collaboration with a global professional services firm, identified outcomes-based financing (OBF) as a high-potential approach to transform ASU’s skilling delivery. In this model, funders such as government, philanthropy, or corporate social responsibility (CSR) initiatives pay for results like student placements, retention, and the inclusion of women and EWS learners, rather than for enrolments alone. This creates strong incentives for training providers to focus on employability and support services that matter for long-term success.
By de-risking providers and attracting private capital, OBF has the potential to scale high-quality training while ensuring that scarce public and philanthropic resources are used more efficiently. In Assam, this approach could enable thousands of youth to not only access training but also secure meaningful and lasting employment, advancing the state’s inclusive growth agenda.
