The ethical lending sector in Wales needs more financial fire-power if it is to continue to grow, says Robert Owen Community Banking Fund (ROCBF).
The Newtown-based lender works with Welsh organisations to help keep investment within local communities, and has just welcomed a renewed investment of £50,000 by Powys charity Cae Post.
Local authorities and councils also invest their reserve funds to strengthen ROCBF’s balance sheet, helping it offer fair finance to small businesses and individuals who may be looking for alternatives to the High Street Banks and traditional lenders.
This lending takes many forms, including helping to launch small businesses such as Pitter Patter Nursery in Llanidloes to funding significant community energy schemes, and providing 0% green home improvement loans.
Mark White, ROCBF CEO says:
”We co-operate with many organisations who allow us to administer their reserve funds. We are able to target these financial resources to support local enterprise and create local jobs.
“We are seeking local organisations to help us achieve this.”
The ethical lending approach chimes with the Welsh Government’s Foundational Economy philosophy, which aims to keep finance within local areas for their benefit.
Chair of recycling charity Cae Post, John Harrington, echoes this sentiment. While the return on their investment with ROCBF was higher than in a traditional bank, this was not the sole purpose in placing funds with them.
“We could invest in the High Street Banks, but there is always the likelihood that the money will leak out of the area. We know that this will not happen with Robert Owen and the funds will benefit Powys and Wales.”
Investing with ROCBF fitted in with Cae Post’s beliefs, he added.
“We have existed as a charity operating in Powys to create local employment for 15 years,” he said. “We aim to give jobs to disadvantaged people who might need a little help to get their lives going.”
Mr White explained the importance of keeping investment within Wales.
“When we look at a loan application we take a holistic view of the proposition, rather than the ‘tick-box’ approach of traditional lenders.”
“We look in detail at the proposed business using broad criteria. We consider its benefits to the local community, as well as the experience and motivation of the people behind it.”
With this in mind, ROCBF has recently backed many new businesses in Wales such as Newtown-based Inner Strength, a physical training studio in the town run by Welsh powerlifter Gerard Matthews.
ROCBF’s recent accreditation for the Enterprise Finance Guarantee (EFG) by the British Business Bank has also widened its lending scope.
The guarantee was instrumental in a recent investment by ROCBF in Cardiff print company Touch Graphics. Touch received funding to support its expansion into new premises, increasing the printer’s capacity and enabling it to restructure into three divisions.
“Our purpose is to support the Welsh economy by offering finance on a fair and equitable basis, and to create sustainable jobs and wealth, and we ask local organisations with similar aims to help us do this,” said Mr White.