GOVERNMENT-BACKED PROGRAMME TO FUND 'GOOD CAUSES' LAUNCHES

24 September 2012

A government-backed pilot scheme, which could lead to millions of pounds being invested in charities struggling to raise money from High Street banks, is to be launched today by the Charities Aid Foundation (CAF), Legal & General and Minister for Social Enterprise Jo Swinson.

The programme has the potential to deliver millions of pounds of social investment to a wide range of charities and not-for-profit organisations currently struggling to raise funding during the recession.

The pilot, which if successful could be rolled out nationwide, will offer charities and other social enterprises in the Brighton and Hove area interest free loans, mentors and expert business advice.

It is being funded with £65,000 from the Cabinet Office-funded Innovation in Giving Fund, managed by Nesta, and £50,000 from Legal & General.

A launch takes place today in Brighton at a not-for-profit organisation that works with people with learning difficulties and mental health needs. Speakers include Minister for Social Enterprise Jo Swinson, Brighton Pavilion MP Caroline Lucas and CAF Chief Executive John Low.

Under the Social Enterprise Assist (SE-Assist) scheme, fledgling social enterprises will be offered interest free loans of up to £10,000 as well as mentoring from Legal & General staff, and up to £5,000 worth of expert consultancy.

The scheme, if rolled out, would transform local communities by providing funding for hundreds of social enterprises across the UK. These social enterprises will help to tackle social issues in local areas while boosting the local economy. The scheme has the potential to help thousands of people.

The programme would encourage local companies to invest time and money to support this important sector of the economy.

John Low, Chief Executive of the Charities Aid Foundation, said: “Social enterprises have the power to tackle many intractable problems in our communities, but often flounder because commercial lenders regard them as too risky to support.

“There is still a chronic lack of funding for fledgling social enterprises which are looking to expand. We need lenders to step in and back these dynamic social enterprises with hard cash and business advice so they have the support they need to succeed. These entrepreneurial organisations can make a massive difference, supporting some of the most vulnerable people in society.

“Without this sort of backing the Government’s vision of a greater role for community groups, social enterprises and charities in delivering local services will remain aspirational.

“We need others in financial services to follow the great lead shown by Legal & General in providing start up capital and vital business advice which can get great projects off the ground.”

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