Interest-free loan scheme for charities is piloted in Brighton
Civil Society, by Vibeka Mair
A new £115,000 government-backed pilot scheme offering interest-free loans and business support to charities and social enterprises in Brighton and Hove, has launched today.
The scheme, called the Social Enterprise Assist scheme, is funded with £65,000 from the Cabinet Office’s Innovation in Giving Fund, which is managed by Nesta, and £50,000 from Legal & General.
It will see social enterprises in Brighton offered interest-free loans of up to £10,000, as well as mentoring from Legal & General staff and up to £5,000 of consultancy.
If deemed successful it could be rolled out nationally.
A social investment committee including representatives from the Charities Aid Foundation (CAF), Legal & General, Nesta and organisations in Brighton such as the Brighton Argus, will assess bids for loans.
John Low, chief executive of the Charities Aid Foundation, said: “Social enterprises have the power to tackle many intractable problems in our communities, but often flounder because commercial lenders regard them as too risky to support.
“There is still a chronic lack of funding for fledgling social enterprises which are looking to expand. We need lenders to step in and back these dynamic social enterprises with hard cash and business advice so they have the support they need to succeed. These entrepreneurial organisations can make a massive difference, supporting some of the most vulnerable people in society.
We need others in financial services to follow the great lead shown by Legal & General in providing start-up capital and vital business advice which can get great projects off the ground.”