Anne-Helene Sinha

Senior Investment Manager

Charities Aid Foundation

How the cost-of-living crisis is impacting social organisations

17 November 2022

Venturesome's response - blended finance, fixed rate and flexible terms

While charities and social enterprises are facing a challenging financial environmentVenturesomethe social investment arm of CAF, is committed to offering flexible, affordable, and patient finance. To support social organisations, Venturesome is extending its blended finance offer (part loan/part grant), offering a fixed interest rate for up to 10 years and flexible terms to suit the needs of the charity or social enterprise

The current economic context is worrying for social organisations, and many are looking at how 'recession proof' they are. Through daily engagement with our borrowers, we are acutely aware that social organisations are currently facing:

  • Rising costs due to inflationary pressures, particularly on staff, utilities, capital expenditures. This is often coupled with an inability to absorb these costs or increase their prices - for instance due to fixed price multi-year contracts, regulatory constraints and cash-strapped recipients. 
  • Increasing difficulties with fundraising, which is particularly concerning at a time when social organisations need it most. 
  • Growing demand and need for their services are putting additional pressure on stretched provision. 

This is not to forget that this current crisis comes off the back of the pandemic, and years of public funding cuts, which had significant implications for many social organisations who work with vulnerable individuals. 

With inflation running well above Bank of England targets, the base rate increased from 0.25% at the beginning of 2022 to 3% in November. For many social organisations, accessing traditional bank lending is not possible. 

While this is incredibly sobering news, we believe there is cause for optimism. We’ve witnessed first-hand from Venturesome’s borrowers that the charity sector is quick to adapt. For instance, by digitising the services or products they offer, or securing fixed price contracts from utility suppliers.  

Moreover, funders and social investors, like Venturesome, are acutely aware of the challenges social organisations are facing and we are all exploring how best to support the sector in these challenging times, offering flexible and timely support.

CAF has announced a new grant programme The Keystone Fund for local charities addressing social injustice, and  is committed to supporting the ongoing resilience of the sector, as it did in 2020 with the £40m Resilience Fund

To support social organisations through this crisis, Venturesome is committed to:

  • Extending our blended finance offer. This was developed during the pandemic, offering grants alongside loans to ensure the long-term resilience of social organisations and ensuring the viability of taking on debt.
  • Continuing fixed rate lending up to 10 years. This is fixed at 6.5% for unsecured loans from our main fund, the Development Fund, which is one of the lowest rates in the market. Thanks to our generous philanthropic funders, our capital is immune to an increased base rate and we will also be maintaining our current arrangement fees. Please see our loan calculator for how much your monthly repayment will be.
  • Offering flexible terms as and when needed. We are able to offer capital repayment holidays (interest only periods), and loan term extensions, ensuring that social organisations are able to navigate more turbulent times without the additional worry of a fixed monthly repayment. 
  • Maintaining our 'no hidden costs' philosophy. For instance, we will not penalise early repayments.
  • Supporting organisations over the lifetime of our investment through a dedicated Investment Officer. For instance, this person would signpost relevant grant funding opportunities.

And we’re not going anywhere! We are here to support social organisations in the long run, as more than 500 organisations can attest to who we have supported in the last two decades. Our 20 Years of Impact Report showcases the impact achieved by a handful of our borrowers with the support of social investment. Venturesome has made over 700 social investments worth more than £61 million in the 20 years since our launch, and we continue to be one of the most active social investors in the sector in 2022. 

If you would like to explore social investment for your organisation, please get in touch with us.

About CAF Venturesome

This year we celebrate 20 years of social investment with Venturesome. Since 2002, we've made over 700 social investments totalling over £61m. Read our 20 years of impact report. 

For more information about applying for social investment at 6.5% for up to 10 years, please see our Development Fund page or get in touch at