The benefits of loan finance can be far reaching for the organisation taking out the loan, as well as for their communities.
Here five charities share how a loan enabled them to generate more income and improve their financial sustainability in order to make a bigger difference to the people they serve:
1. Built a new income generating facility
"At Whitlingham Boathouses Foundation we’re passionate about water sports and we exist so that people in Norwich and Norfolk can enjoy both rowing and canoeing.
"We formed as a registered charity in 2009. Our premises were in poor condition, of limited size and did not give easy access to the water but, thanks to a Charity Bank loan in 2011, we were able to build the first phase of our new boathouse. We are repaying the loan from service charges from our member clubs and other users.
"After a new fundraising round, we opened the first floor in 2015, including a café, changing and gym facilities, which is generating additional income and contributing towards the repayments. The support from our Charity Bank regional manager has been great and the loan was essential, quite literally, to getting us off the ground in creating the boathouse.
"We can proudly say that all our facilities are fully accessible for everyone, including wheelchair users. With adaptive (disabled) boats and a great boathouse, we’re getting more people out on the river."
Max Heron, Trustee, Whitlingham Boathouses Foundation
2. Converted an existing underused asset
"The prime purpose of the Wing Hall Trust is to manage the Village Hall for the benefit of the local community. The charity also owns an adjacent property which has had a variety of uses primarily to generate income to cover the running costs of the Hall (cottage hospital, GP surgery, office space). A review of the future prospects of managed workspace in a rural location was not promising, so the decision was taken to convert the property into residential accommodation to maintain a sustainable income stream.
"Applying for grants from charitable trusts to fund the project was not an option for us as the conversion was deemed “non-charitable” and the high street banks were not interested. Charity Bank filled this funding gap and made the conversion possible.
"Now that this building has been transformed into new homes for local residents, the Trust has restored its long-term sustainable position and secured the Hall for local community use at an affordable rate, subsidised by rental income."
Malcolm Oliver, trustee, Wing Hall Trust
3. Developed an income generating social business
"We used our loan to open a shop in Shrewsbury, called Reviive, selling upcycled furniture and household goods, which would otherwise end up in landfill. As well as our environmental mission, we’re able to provide employment to the long-term unemployed and offer apprenticeships to young people who need work experience to enter the job market.
"Charity Bank helped us with our set up costs. We’ve gone from strength to strength and have recently opened another shop in Chester. Our profits, above and beyond running costs, go to the two charities that set us up; The Shropshire Housing Alliance and The Shropshire Furniture Scheme. In the past twelve months, we have sold 516 tonnes of furniture and recycled 200 tonnes, therefore in total preventing 716 tonnes from going to landfill."
Julian Price, managing director, Reviive CIC
4. Improved facilities to grow income
"Reds in the Community is a registered charity that uses the power of football and Barnsley Football Club to engage and improve the lives of local people. We took out a loan with Charity Bank at a time when there was a lot of competing pressure on our facilities; in particular our old multipurpose all-weather football pitch was tired and worn. The charity wanted to protect the pitch for community use (as opposed to the facility just being used by the professional football club), so the solution was to raise funds to replace it with a new generation artificial grass pitch.
"A funding package was put together, consisting of grants from the Football Foundation, our own reserves and a loan from Charity Bank filled the funding gap, to enable the project to go ahead.
"The loan repayments were built into the ongoing running costs of the charity, crucially the new pitch gave us the ability to hire out the facility, increasing revenue streams.
"The replacement has been crucial – the work of the organisation was at risk with the loss of a major community resource. The loan was part of the funding package that has stabilised the work of the charity, enabled it to construct a sustainable business plan, increase the use and extend the reach of the project."
Wayne Bullimore, chief executive, Reds in the Community
5. Moved to a better location
"The loan from Charity Bank allowed us to purchase a property in the centre of Sturminster Newton, in Market Place, to use as a museum and relocate from our previous, rented property. The museum is now housed in an historic and attractive building of 16th century origin in the heart of our bustling market town.
"The move to a more suitable and prominent site has helped us to attract new visitors, allow the museum to progress to accreditation and achieve financial stability."
Richard Brown, treasurer, Sturminster Newton Museum & Mill Society