The UK’s responsible finance providers lent to more social enterprises in 2018 than in the previous 12 months, but the total value of their loans fell, according to a report published today.
Responsible Finance: The Industry in 2018 says providers disbursed 475 loans to social enterprises totalling £138m in 2018, compared with 363 loans totalling £142m in 2017.
The report was published by Responsible Finance, which is the trade association for 50 lenders, primarily community development finance institutions, that invest for social purposes rather than profit.
Jennifer Tankard, chief executive of Responsible Finance, says in her introduction that the industry's ambitions for growth are being hampered by a lack of available capital for investment.
She adds that funding sources have shifted, with social investors providing "considerably more" investment while government and banks are providing less.
She told Third Sector: "There is no one or obvious reason for this, although it might be that as the social investment market matures our members simply find it easier to approach those that have a good understanding of mission-driven investment."
The report is based on data supplied by 36 members of Responsible Finance for the financial year ending 31 March 2018.
It says the £138m lent to social enterprises led to the creation of 25 social enterprises and 510 new jobs, as well as safeguarding 3,550 jobs.
The overall size of the responsible finance sector, which includes loans to businesses, individuals and home-improvement schemes as well as social enterprises, is valued at £254m in 2018, an 8 per cent increase on the £235m figure for 2017.