Who is eligible for a loan?

We can lend to any organisation that is either a registered or exempt charity, as well as to community associations, voluntary organisations, community businesses, social enterprises or social landlords as long as the purpose of the loan is charitable. We also lend to ‘for profit’ companies if the loan is for exclusively charitable purposes. We often lend where banks or building societies either will not make a loan at all, or will only do so on unaffordable terms.

Your governing document (eg constitution or memorandum and articles of association) must give you the legal power to borrow and, if necessary, to pledge assets as security for the loan. Sometimes this might not be clear, so you may need to consult your solicitor or the Charity Commission. Unincorporated organisations have an implied power to borrow but will still require a specific power to charge assets. Changing your powers to allow borrowing or the giving of security can be a lengthy process so it is best checked at the outset.