Third-sector organisations are being frustrated in the search for outside finance by poor governance structures, Malcolm Hayday, chief executive of Charity Bank, will tell the Charity Law Conference next week.
The bank more than doubled its balance sheet last year and now has £25m available for new loans. But Hayday believes many organisations haven't thought through the implications of an injection of money.
"Too often we have to pause, cajole or even turn an application away," he will say. "Not because the proposition is unviable, but because the applicant has not yet shown a proper understanding of the skills needed to sustain their charity."
The bank, sponsor of the conference, received more than 400 enquiries last year, turning 100 into approved loans. "Many are still being developed," Hayday will say. "But with a bit more thought, more could be helped to achieve their goals."
The skills needed to help a charity expand are different from those required to kick off an idea, he will add.