Expanding Water Supply and Sanitation Coverage through Output-Based Aid

Abstract

Output-based aid is a scheme that uses performance-based grants to support delivery of basic services to traditionally marginalized poor households. Such schemes have generally targeted rural villages but, on occasion, large cities. For its first use of OBA, ADB will test the scheme in small towns in Nepal. The Asian Development Bank is set to undertake its first output-based aid (OBA) initiative. Will it prove to be the right modality for Nepal’s small towns and their water supply and sanitation concerns?.