# Small charities stumped over Social Impact Bonds

- Link: https://fundraising.co.uk/2016/05/18/small-charities-stumped-social-impact-bonds/
- Published: 2016-05-18T09:23:31+01:00
- Author: Melanie May

**Social Impact Bonds are little understood and therefore being under-utilised by
small charities according to this quarter’s [Small Charity Index](http://www.thefsi.org/wp-content/uploads/2016/05/SC-Index-Dec-Feb-16.pdf)
from the Foundation for Social Improvement (FSI).**

The report questioned 316 respondents between the 1st March 2016 and the 22nd April
2016, and refers to the period 1st December 2015 to 29th February 2016. It reveals
that more than half of small charities (52%) have little or no knowledge of Social
Impact Bonds, while none feel fully informed. As a result, SIBs are being under-
utilised with less than one percent of small charities receiving funding in this
way in the past year.

However, according to the FSI, one in 10 small charities also reported a decrease
in statutory income in the last quarter, with statutory income declining by six 
per cent in total since June 2013. Yet, at the same time as a decline in funding,
the research highlights an increase in demand for the services of small charities:
up 60 per cent this quarter.

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SIBs are a method of public funding, which were introduced by the government with
the aim of reforming public service delivery, and are described as a means to improve
the social outcomes of publicly funded services by making funding conditional on
achieving results. Investors pay for the project at the start, and then the service
provider receives payments based on the results achieved. Information on Social 
Impact Bonds can be found [on the .gov.uk site](https://www.gov.uk/guidance/social-impact-bonds).

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