Charity Bank and Senscot join forces to create a Scottish Community Bank

Plans for the bank will be announced by Charity Bank's chief executive Malcolm Hayday in October

Malcolm Hayday
Malcolm Hayday

Charity Bank is working with Senscot, the network of Scottish social entrepreneurs, to create a new Scottish Community Bank.

According to a position paper published by Senscot, the new bank will offer deposit banking, including current accounts, to Scottish charities and to people interested in supporting a social mission, and will seek investment capital from charities, government and other social sector organisations.

It will provide a variety of types of lending to charities in the Scottish sector and will develop social investment opportunities for Scottish charities.

The two organisations will work together with Community Enterprise in Scotland, the support organisation for community business, to create the bank.

The bank will initially be a branch of Charity Bank, but will be launched with a view to becoming an independent organisation with its own banking licence.

"The potential economic impact of our Scottish third sector is considerable but unrealised," the position paper says. "The reason is that most of us choose to do business with banks that have no commitment to our core values.

"The financing of the third sector is changing rapidly from grants, through loans, to equity. A number of interesting developments and discussions are exploring new models of investment.

"The vision is of a Scottish Community Bank – a new Scottish institution for receiving social investment, including our own investment resources, and making investment in social enterprises. It's a philosophy of mutuality.

"Rooted in the Scottish third sector, the Scottish Community Bank would use the collective impact of our own money to create financial products consistent with the mission and values of our sector."

Further plans will be announced by Malcolm Hayday, chief executive of Charity Bank, and Aidan Pia, executive director of Senscot, at the Senscot annual general meeting on 5 October.

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