# CAF Social Impact Fund offers £2.2 million in loans to charities in first year

- Link: https://fundraising.co.uk/2012/07/09/caf-social-impact-fund-offers-22m-loans-charities-first-year/
- Published: 2012-07-09T13:29:52+01:00
- Author: Howard Lake

Charities Aid Foundation reports that its CAF Social Impact Fund has offered £2.2
million in loans to 22 organisations in its first 12 months.

The Fund enables individuals to lend charitable funds to support charities and social
enterprises. These are then made available as unsecured loans to charities and social
enterprises, offering an alternative to traditional funding sources, or sources 
that have diminished. When the organisations repay the loan, the money is recycled
again until it is returned to the supporter’s CAF Charitable Trust.

Charities Aid Foundation believes that such social investment funds are likely to
grow significantly in the next few years precisely because they offer another source
of funding amid the ongoing difficult economic conditions.

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## First beneficiaries of CAF Social Impact Fund

Beneficiaries of the Fund in its first year include:

 * Village Water is a charity providing hygiene and sustainable water to rural villages
   in Zambia. A £50,000 CAF loan has enabled 20,000 people to gain access to clean
   water.
 * Midi Music Company offers music lessons, industry recognised courses, and music
   career advice to 2,500 children and young adults. The small charity needed a 
   £36,000 loan to continue its work while waiting on the sale of some land. CAF
   Social Impact Fund was able to help after its local bank said no to a loan.
 * International development charity iDE UK supports rural farmers in Africa to 
   increase their annual incomes through the use of micro irrigation technology.
   The £160,000 loan from CAF will help 6,600 farming families to increase annual
   incomes through the irrigated farms project.

Stephanie Sturrock, Director of Social Investment at the Charities Aid Foundation,
said: “Lack of appropriate funding is a major barrier to charities. In this economic
climate, few charities have sufficient reserves to fund their activities in advance
of promised funds and few have assets which can be used as security for commercial
loans…

“The first year of our Social Impact Fund has shown how it can transform the work
of charities by helping them expand or find new long term sources of funding.

“Social investment has huge potential to expand the work of charities and other 
organisations, and recycle money so it works harder for the causes people care about.”

www.cafonline.org

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