There’s a lots of talk about social investment right now: from social impact bonds, to loans, or quasi-equity. But what if you’re a charity with no reliable income stream to make repayments or don’t have an asset to secure an investment? Can you still benefit from social investment?
Today, we publish a report on a series of charitable bonds developed by the charity Allia, which use social investment to generate unrestricted donations for charity. Allia commissioned us to review these bonds and provide an independent perspective on the risks and benefits for charities and investors.
We found that the bonds are a useful tool for all charities to encourage urgently need funds into the charity sector. But they are likely to be particularly attractive to charities that aren’t ‘investment ready’ and so are at risk of being shut out from the source of funding that social investment can provide.