At our Social Enterprise Conference in December 2017, the lack of appropriate loans, in particular bridging loans, for social enterprises was raised by many attendees. At the same event, a new Community Bond – the first of its kind in Scotland – was launched with the intention of creating a Loan Fund that will provide affordable, micro, unsecured loans (including bridging loans) to SEN members across Scotland.
The significance of this new Community Bond offer is two-fold:
- As stated above, many grassroots social enterprises continue to find it difficult to access the loans they require. Reasons tend to include: insufficient turnover; not being able to offer security; not being going long enough; or the sum of money required is too small – and therefore the ‘deal’ is not of sufficient value to the lender. This new Community Bond is being set up specifically to address these gaps in loan provision for smaller, grassroots organisations.
- The social enterprise community in Scotland often speaks of working in a collaborative and supportive manner – this initiative provides the opportunity to put these aspirations into practice. In December 2014, the Scottish Community Re:Investment Trust was established – with the mission of “allowing the sector to pool its financial resources for the mutual benefit of the sector and the communities it serves”. This is the first step in that journey.
With help from as many of the SEN community as possible (organisations, staff and trustees) the Community Bond should be able to raise the £100k target – with the funds being used to capitalise a Loan Fund and which will be open exclusively to applicants who are members of SENs, by the end of summer 2018.
- Community Bonds are available from £50 each
- They will offer 2% interest.
- Investments can be for a minimum of 3 years
- The offer is open to both organisations and individuals. This includes staff; trustees; members; and volunteers.
It’s also important to note that any bond purchase is a ‘social investment’ in the SEN community. This does not contravene charitable objectives and such a social investment by a charity is not prohibited by OSCR.
Pauline Hinchion at SCF would be more than happy to come and meet with you and/or your SEN to discuss the Bond Offer and how it works in more detail. Please feel free to contact Pauline directly on 07934 690429 or email firstname.lastname@example.org
We ask that you give this initiative every consideration and hope that you are able to offer your support.
Many thanks and best wishes,