Charity Bank has received a £100,000 deposit investment from share donation charity ShareGift.
The portion of ShareGift's reserves will be loaned to Charity Bank clients but will still belong to ShareGift and can be reclaimed. ShareGift will donate the interest from its deposit to Charity Bank.
Bridget Franklin, charity director at ShareGift, said: "Our remit is to support charities by taking a financial asset that is going to waste and leveraging it for charitable good.
"So it made complete sense for us to use our reserves in the same way by depositing them with Charity Bank and making our money work twice as hard for the good of charities."
ShareGift, the brand name of the Orr Mackintosh Foundation, has donated more than £8.5m to 1,000 UK charities since 1996. The foundation has undergone rapid growth, its expenditure rising from £200,000 in 1999 to £2m in 2004.
Malcolm Hayday, chief executive of Charity Bank, called on other charities to consider investment in the bank as a means of furthering their charitable missions. "We are subject to the same rules as any other bank and therefore offer the same level of safety to depositors. However, unlike other banks, we exist to help organisations address important social concerns."
Under Charity Commission rules, investment that furthers a charity's mission is not officially classed as investment and is therefore not required to be used to maximise financial returns.