Christ Church Aughton is a large parish church in Ormskirk. A few years ago, the church got an offer that was too good to refuse but needed a loan to help deliver its vision.
Parochial church council (PCC) treasurer, Mark Patterson, and former treasurer, Chris Matthews, tell us more.
Why did you need a Charity Bank loan?
We’re a faith-based organisation and provide services to the whole community. Back in 2010, the educational authority kindly allowed the church to take over an old school building next to the church, for us to knock down and build our Ministry Centre.
The vision of the centre is to minister to the people in our locality, but it also has a large café and serves a lot of other community requirements. Prayer meetings, youth groups, knit ‘n’ natter sessions, toddler groups, community lunches, counselling services and so on are all held at the centre. There’s even a ukelele group!
Could you have built the centre without a loan?
No. Without the loan, we would have had to wait a few more years to start the building work.
The build cost around £1.1 million. We raised £700,000 through church funds, legacies and fundraising, and Charity Bank provided a loan of £325,000. The rate and arrangement fees were very decent.
Does the café bring in enough money to cover the loan repayments?
The loan repayments come from the café’s profits and general church funds. We recently paid a chunk of the loan off when someone left the church a gift in their will. People have also pledged a monthly amount to help cover the loan, anything from £5 a month to over £100. Ultimately, the loan repayments come from the pockets of parishioners.
Do you know why Charity Bank was chosen for the loan?
1: It’s an ethical bank; 2: it looks after charities; and 3: other banks weren’t very interested! For most commercial banks, the security platform of a project like this just isn’t what they’re looking for. Church accounts don't show large surpluses, so it can be difficult for banks to assess their credit worthiness. Charity Bank is different as its lending aims to create a social dividend, so I think it was a natural choice.
Did the church or PCC have any concerns about taking out a loan?
You have to do these things on faith. It helped that quite a few people had pledged a monthly amount, which covered a lot of the loan costs. That meant we didn’t have to ask people to provide guarantees.
10 years’ on, how’s your relationship with Charity Bank?
Charity Bank have always been very speedy at coming back to us if we have a question. They’ve been very helpful, particularly compared to other banks we’ve dealt with. We’re not seen as important to the bigger banks, but with Charity Bank, we’re treated fairly, as a valued customer.
What would you say to other faith-based organisations or charities that are thinking of applying for a loan?
I’d probably just say that the first place to go to is Charity Bank as your credit risk profile is assessed differently and they’ll treat you fairly.
If you need a loan for your church or other faith-based organisation, please call Charity Bank on 01732 441919.
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 1,100 loans totalling over £400m to housing, education, social care, community and other social purpose organisations.
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