The Challenge
India’s private hospitals, especially small and mid-sized maternity and multi-specialty facilities in Tier 2 and Tier 3 cities play a critical role in delivering maternal health services. Yet, many face barriers to both quality improvement and affordable finance. With limited collateral, weak financial records, and high borrowing costs, these hospitals struggle to invest in staff training, infrastructure upgrades, or accreditations. As a result, women and families in these regions often lack access to safe, high-quality care. While banks and NBFCs see healthcare as a low-risk sector, they remain hesitant to lend to smaller facilities due to poor documentation, lack of collateral, and high perceived risk. At the same time, hospitals are reluctant to pursue certifications unless they see direct business benefits such as increased patient volumes or easier access to insurance/TPA networks. Without an aligned financial mechanism, certification uptake remains low, threatening progress on maternal health outcomes.
Blended Finance in Action
A large global philanthropy and TBFC are designing an impact-linked financing model that uses blended capital to align incentives across hospitals, lenders, and programs that ensure quality assurance and certification initiative by the Federation of Obstetric and Gynaecological Societies of India (FOGSI) for private maternity facilities in India.
TBFC is helping explore instruments like impact-linked loans and guarantee mechanisms to increase the uptake of quality certifications through the use of financial incentives. Over time, the model aims to make quality certification self-financed and sustainable, while demonstrating to lenders that quality-linked facilities are lower-risk borrowers.
