Citylife set to issue multi-charity bonds

New bond issue will allow investors to raise funds for a dozen charities

Citylife chief operating officer Phil Caroe
Citylife chief operating officer Phil Caroe

The social finance charity Citylife is preparing to issue a new multi-charity bond next month.

Citylife, which is soon to rebrand as Allia, has previously issued bonds that raise money for individual organisations. But the new bond issue will allow investors to raise funds for a dozen charities, said Phil Caroe, chief operating officer at Citylife.

Individual and corporate supporters of charities that purchase bonds can choose to receive back as much as they originally lent, or to receive a fixed return of up to 10 per cent over five years.

A portion of their investments will be loaned to housing associations at a higher rate of interest.

Citylife will take a fee and the remainder of the money will go to the charities as donations.

Depending on the interest rate the investor chooses, the donation to charities will be between 6 and 15 per cent of the total value of the bond, Caroe said. "We're planning to run bond issues every four months," he said.

"The first one will be a pilot, but thereafter we're interested in encouraging more charities to sign up."

The pilot bond, which will support charities such as Tomorrow's People, which helps unemployed people restart work, and Community Links, which helps disadvantaged local people, will be launched at the Raising Funds from the Rich conference on 7 December.

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