Social finance involves the provision of repayable loan finance at affordable rates to community-based projects and local development initiatives (including individual and community micro-enterprise), which yield a social and financial return.
Providers of social finance
The Social Finance Foundation (SFF) was launched in 2007 with seed capital funding of €25 million provided by the banking sector through its representative body, Banking & Payments Federation Ireland (BPFI). Participating financial institutions approved a loan agreement with SFF, through which they would make €72 million available in loans at competitive interest rates appropriate for social finance.
Since its inception, SFF has approved over €80 million in loans for community-based projects and micro-enterprises.
How does social finance work
The SFF uses a wholesale finance model. This means that it does not lend directly to social finance projects. Instead, it provide wholesale lending to social lending organisations (SLOs). These lenders in turn receive and assess applications from borrowers for social finance. The SLOs aso decide the terms and conditions of the loans, including the interest rate.
How to apply for social finance?
For more details about the SFF, the SLOs that provide the loans and how to apply, please visit the SFF website here.