Social Finance Foundation announces 2023 lending of €25.5 million to 253 community organisations across all 26 counties
- Term and bridging loans of up to €600,000 now available through Social Finance Foundation’s lending partners – Clann Credo and Community Finance Ireland
- Social Finance Foundation is funded by the retail banks (AIB, PTSB and Bank of Ireland) and the Council of Europe Development Bank with additional support from the European Investment Fund.
- Social Finance Foundation has lent €225m to over 2,000 community projects across Ireland since 2007
- Social Finance Foundation to nearly double community lending from €59m to €100m by 2029
26th June 2024: Social Finance Foundation, the non-profit body that provides loan finance for community projects around Ireland, has reported that it lent €25.5 million to 253 community groups across all 26 counties in 2023. The average loan value was €101,000. The funding is provided by the retail banks (AIB, Bank of Ireland and PTSB) and the Council of Europe Development Bank, with additional support from the European Investment Fund.
With its motto ‘Finance for Social Good’, Social Finance Foundation is encouraging community & voluntary groups and social enterprises to apply for loans from €10,000 to €600,000 through the Foundation’s social finance lending partners – Clann Credo and Community Finance Ireland. Loans are available, with minimal processing time, to community and voluntary groups or social enterprises that create a social benefit for their community.
The 2023 loan funding was allocated across seven sectors, with Community Sports and Health/ Leisure receiving the majority of the funding:
- Community Sports, Health & Leisure: €13.4m (53%)
- Community & Voluntary Groups: €6.9m (27%)
- Social Enterprises: €3m (12%)
- Arts, Heritage & Tourism: €0.9m (3%)
- Minority Religions: €0.7m (3%)
- Education and Social Care Housing: €0.6m (2%)
Community Groups
Two community groups that have recently benefited from social finance loans are SPADE Enterprise Centre and CRNI (Community Resource Network Ireland).
Established in 1987 and based in St. Paul’s converted church in Dublin’s Smithfield district, SPADE Enterprise Centre secured a bridging loan through Clann Credo, a lending partner of Social Finance Foundation. The Clann Credo loan enabled SPADE to leverage grant aid from Enterprise Ireland.
SPADE offers shared office and kitchen space, as well as networking and mentoring to a community of 50 early-stage businesses with a strong focus on the food sector.
Commenting on how social finance made a difference to its operation, SPADE CEO Bernie Everard, said: “We directed our social finance loan to our SPADE Shared Kitchen initiative which is totally unique and is going to transform how young startup businesses produce their food and beverages. There is nowhere else like it in Dublin, and it will provide young entrepreneurs with a truly unrivalled base that is affordable and sustainable. The whole business of producing food and drinks is a huge undertaking for young start-ups who may have a wonderful idea but simply cannot afford the cost of renting prohibitively expensive commercial kitchens. With the assistance of social finance, at SPADE they will have access to the highest quality facilities for very nominal charges.
Established in 2010, CRNI (Community Resources Network Ireland) is the representative body for community-based reuse, repair and recycling organisations in Ireland. CRNI’s aim is to provide a range of practical supports to its members, and to promote community based, sustainable waste management as a practical and effective way of tackling Ireland’s growing waste problem. CRNI secured a loan through Community Finance Ireland, a lending partner of Social Finance Foundation.
CRNI’s Executive Director, Chris Mooney-Brown said: “As with many social enterprises and charitable organisations, CRNI’s growth and business development is dependent on its capacity to innovate in the sector. Social finance is uniquely placed to provide valuable support for organisations such as CRNI to innovate and scale up its pilot projects. For us means being able to amplify the collective efforts of our members in pursuit of Ireland’s circular economy ambitions.
Social Finance Foundation’s Funding Sources
Since its inception in 2007, the not-for-profit Social Finance Foundation has benefitted from donated and low-cost funding from AIB, Bank of Ireland and PTSB, and previously KBC and Ulster Bank. This came in the form of an original €25m non-repayable grant, followed by €116m in two tranches of loan funding at preferential interest rates for the combined period 2009 to 2025.
The Foundation has recently added €20m in loan funding from the Council of Europe Development Bank and also enjoys the support of the European Investment Fund through a €25m loan guarantee facility.
The combination of bank and EU funding has enabled the Foundation to lend over €225m to over 2,000 organisations since 2007. This loan funding has facilitated community and social organisations to achieve their goals, delivering strong social benefits to their local communities.
A key feature of loans enabled by the Social Finance Foundation is the provision of bridging loans. Community groups are often in receipt of grants which are only paid when the work is completed and hence the importance to have bridging finance for the development which is then repaid when the grant is received. Approximately one third of its loan book is comprised of bridging loans.
Commenting on the benefits of social finance, Social Finance Foundation, CEO Garrett O’Donohoe said: “The money is available to lend on a flexible basis without unnecessary delay. Having access to finance, without personal recourse to trustees and volunteers, enables communities to generate a social dividend right from the start as people have a sense of belief and purpose in getting their project off the ground. The Foundation advances term loans but also bridging loans which provide communities with funds upfront while waiting for grants which are only paid after a project is completed.
From the Foundation’s point of view, along with our social lending partners, we find that community groups are very reliable borrowers with an excellent track record in repaying their loans because there is a commitment by community volunteers to make the project a success to benefit the entire community.”
He added: “We are seeing a notable increase in applications from the environmental and bio-diversity sector which we are keen to grow as a percentage of our lending. Similarly, we also want to foster more social enterprises in communities.”
Social Finance Foundation plans to nearly double the social finance sector from €59 million currently, to €100 million by 2029.
Commenting on this year’s report, Brian Hayes, Chief Executive of Banking & Payments Federation Ireland (BPFI), stated: “Today’s lending report from Social Finance Foundation demonstrates the continued importance of affordable and accessible lending to voluntary groups and social enterprises in Ireland, which are the lifeblood of our communities and positively impact thousands of people across the country. In providing Social Finance Foundation with low-cost finance, our retail member banks, AIB, Bank of Ireland and PTSB are proud to indirectly support these important initiatives to get vital access to affordable lending arrangements. We look forward to continuing to support Social Finance Foundation along with their social lending partners Clann Credo and Community Finance Ireland.”
ENDS
Note: Banking & Payments Federation Ireland (BPFI) represents the banking, payments and fintech sector in Ireland. Together with its affiliates, the Federation of International Banks in Ireland, and the Fintech & Payments Association of Ireland, BPFI has over 125 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace.
Contact: Jillian Heffernan, Director of Communications, 087 9016880, jillian.heffernan@bpfi.ie.
