Loans approved by Charity Bank since Big Society Capital agreed to invest in the Bank at the end of March have increased by 43% in number and 220% in value compared to the same period last year.
Big Society Capital agreed to make its largest ever single investment – up to £14.5m of ordinary shares in Charity Bank in three successive tranches between 2014 and 2016 – on 28th March 2014.
Since the investment at the end of March, Charity Bank, which takes savings from individuals and organisations, and lends solely to social sector organisations, has approved 40 new loans, worth just over £19 million, compared with 28, worth almost £4.5 million, over the same period last year.
“When organisations borrow from Charity Bank, they are borrowing from a bank that knows and understands the sector."Patrick Crawford, Chief Executive of Charity Bank
He added: "Social sector demand for borrowing continues to increase at a time when some mainstream banks remain reluctant to lend. In contrast, we have funds available to lend and are inviting charities and other social sector organisations to come and talk to us.
“Mainstream banks do not typically understand social sector organisations or the workings and ethos of the social sector. This can make it difficult for these organisations to obtain loan finance.
“We take care that our loans are on terms that are appropriate and we work with organisations if their plans change or if they suffer financial stress later.
“As a social enterprise that exists to help social sector organisations to access loans, we have similar values to the organisations we support. And, as organisations borrow and make repayments to Charity Bank, they are putting money back into the sector, as these funds are re-lent to help other charities and similar organisations achieve their goals.
“Charity Bank is the bank of choice for social sector organisations that need a loan and, as a result of our recent investment, we can lend at competitive rates from £50,000 up to £2.5 million and more in partnership with other social lenders.”