The National Bank for Agriculture and Rural Development (NABARD) has fully subscribed to the ₹4 crore maiden Zero Coupon Zero Principal (ZCZP) issue of the National Skill Development Corporation (NSDC) on the National Stock Exchange’s Social Stock Exchange (SSE), supporting a programme to create overseas employment opportunities for 600 rural youth belonging to Other Backward Classes (OBC) in Madhya Pradesh.
The project, with an estimated outlay of ₹11.25 crore, aims to equip rural youth with skills required for employment in Japan and Germany. It also marks an expansion of outcome-based financing models that link funding to measurable social impact rather than merely the completion of training programmes.
The initiative is being implemented by NSDC in collaboration with the Madhya Pradesh government.
Under the financing structure, the state government is expected to provide ₹5.60 crore in outcome-linked funding upon the achievement of agreed employment outcomes. The remaining amount, apart from NABARD’s ₹4 crore subscription, is proposed to be mobilised through beneficiary contributions.
Focus on overseas employment outcomes
The programme will provide beneficiaries with language training, technical skills, certification and cultural orientation to prepare them for overseas employment.
It will also cover end-to-end placement support, including documentation and deployment assistance, with the objective of helping participants secure sustainable jobs in international labour markets.
Unlike conventional skill development programmes that often measure success through enrolment, training completion or certification, the initiative emphasises verified overseas employment and sustained livelihood improvement.
The outcome-linked funding structure is intended to ensure that the programme’s success is assessed against tangible employment results and the resulting benefits to rural households.
Social Stock Exchange gains traction
The transaction highlights the potential of the Social Stock Exchange as a mechanism for mobilising funding for development projects with clearly defined social objectives.
Established under the regulatory framework of the Securities and Exchange Board of India (SEBI), the SSE provides a platform for eligible social enterprises and non-profit organisations to raise funds through prescribed instruments and disclosure mechanisms.
The Zero Coupon Zero Principal instrument enables eligible entities to raise funds for social projects without an obligation to repay the principal or pay interest to investors. Its structure makes it particularly relevant for initiatives where the primary objective is measurable social impact rather than financial returns.
NABARD’s subscription to the NSDC issue represents an institutional contribution to the development of this financing ecosystem.
Collaborative funding model
The project brings together a development finance institution, a state government and a specialised skill development organisation to finance an employment-oriented intervention.
By linking a portion of public funding to the achievement of agreed outcomes, the model seeks to strengthen accountability, improve resource utilisation and ensure that development spending translates into tangible livelihood benefits.
For rural youth, access to overseas employment could provide opportunities to improve earnings and support their households. The programme’s emphasis on language proficiency, technical certification and cultural preparedness is intended to address the requirements of international employers.
NABARD expects the experience gained from the initiative to provide insights into designing and monitoring outcome-linked development programmes and encourage wider adoption of Social Stock Exchange-based financing across sectors.
The project seeks to demonstrate how innovative financial instruments and collaboration between public institutions can connect rural skill development with global labour demand while keeping measurable social outcomes at the centre of programme implementation.