A Chief Officer’s perspective: 10 years with Charity Bank

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It all started with a pen … Back in 2011, a chance meeting led to Age UK Herne Bay taking out an ethical loan with Charity Bank. 10 years and a second loan later, what does the charity’s Chief Officer, Sue Cliffe, have to say about the relationship?

Why did you need your latest loan?

In 2010, Age UK Herne Bay bought a 40-bed convalescent home, which we converted into a day centre. Then, in 2017, Age UK Whitstable closed and we took on their day centre clients. It became a bit squashed here with all the new people, so we needed a ground floor extension.

We let out the first floor to other charities to bring in extra income. One of the tenants wanted more space, so we also needed to extend the first floor.

We started fundraising in 2018 and raised £750,000 for the project. A lot of charitable funds give you a year or so to draw down the money. We were getting close to that point, so we decided to get a loan for the remaining money that we needed for the project.

We took our first loan out with Charity Bank back in 2011 and decided to borrow an extra £500,000 for the extension. We thought the project would come in around £1.1 million, but we wanted to be sure that we had the extra money if we needed it. In the end, the project went up to £1.3 million and we also extended the car park, which was another expense.

Are you earning extra income as a result of the extension?

In all, our annual rental income has increased from £54,000 to £86,000. The rental income more than covers our loan repayments. We now have four charities renting space on our first floor. We’re also encouraging other groups to rent the ground floor space in the evenings, and we let out our training rooms too.

Could you have achieved the extension without a loan?

Not really. We did look at just extending the ground floor, but the ambition was to have both floors done at the same time. Because of our previous experience with Charity Bank, we were comfortable taking out a loan. The site has a high value and we also own other properties that we get rental income from.

We knew that if we didn’t take out a loan, we’d risk losing the grants, so right from the very beginning the trustees said that we could take out a loan if we needed to.

Were you as confident the first time you took out a loan, back in 2011?

We were nervous the first time. We needed the money to pay for and refurbish our building. We went to a fundraising event, picked up a Charity Bank pen and got talking to them. And it went from there.

That first time, we had a lot of handholding from Charity Bank. The staff are very personable and you’re mainly dealing with one or two people, so you get to know them. They ask you questions. You say, “We don’t have that!” and they say, “Don’t worry, this is how you can get it.” So, they talk you through the process.

The professionalism and rigour of the process gives you confidence. We’re a small charity, but we could see that Charity Bank wasn’t going to lend us money unless they were satisfied that we could afford the repayments.

And how did you get on with that first loan?

When Carolyn Sims [Charity Bank’s Director of Lending] first visited us, she said, “If you get into difficulty, don’t hang around; get in touch quickly.” Charity Bank recognises that things don’t always go perfectly. But actually, we’ve had more legacies in than normal so were able to pay down some of the loan early.

What did you learn from that first loan?

We weren’t so ambitious then, but we have thrived in our new premises. We’ve become a community hub for other charities too. The flexibility of our first loan worked well, so we knew we wanted the option of paying our new loan back early in lump sums.

We wouldn’t have been so gung-ho the second time around if we hadn’t had such a good first experience.

Did you consider other banks for your second loan?

No. In fact, we could have paid our first loan off quicker, but we left some money outstanding to make it easier to borrow more from Charity Bank.

How did you find the process of applying for a loan second time around?

If anything, it had become even slicker than when we first applied 10 years ago. Jeremy Ince [Regional Manager] was always quick to reply to any questions.

Is there anything you wish you’d known at the start of your loan journey that you do now?

Not really. It’s a great process. I really believe that everyone I’ve met at Charity Bank has got it right. They deal with all sorts of charities with all sorts of assets, so they understood us. And it always felt very professional. I would definitely recommend Charity Bank.

Did the loans help you to get grant funding?

Well, charitable funds ask smart questions now. They want to know how you’re going to reach your target. All along, we could say that if we didn’t raise enough then we’d get a loan.

I believe you also added some services during the pandemic, including delivering meals to people who were isolating. Can you tell us more about that?

We were already offering a hot meals delivery service but went from 60-70 meals a day to 120 a day. We’ve also helped with dog walking, laundry and a range of other things.

A lot of our volunteers are over 70 and needed to shield, so we put a shout out on social media and got around 60 new volunteers. Many of them were furloughed or working from home at the time, but a lot of them are still helping us now.

We even had a chef who came and cooked for us using a mobile kitchen. We’ve made some firm friends and corporate contacts in the community. If we have a shout out for help now, people respond. For the VE Day celebrations, we got hundreds of cakes delivered to us to send out to people. Times are hard for everyone, but businesses and people freely give us what they can.

For older people, the pandemic has been a real tragedy. Many carers couldn’t cope without our support. The people they looked after had to go into long-term care. Other people are finding that their mobility isn’t as good as they’re not getting out of the house. Some haven’t put on shoes for a year.

Younger people have struggled too. We usually focus on the frailest older people, but we’re planning to do more work with the 50+ population as services aren’t always there for them. We’ve started a walking football programme and are considering launching a Men’s Shed, healthy eating workshops and so on, so we’re still looking ahead.

If you need finance for your charity’s building project, please call us on 01732 441919. for an initial conversation.

About Charity Bank

Charity Bank is the loans and savings bank owned by and committed to supporting the social sector. Since 2002, we have used our savers’ money to make more than 1000 loans totalling over £350m to housing, education, social care, community and other social purpose organisations.

Find out more about us here.

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