FREDERICKS Foundation, a registered charity and responsible finance provider, has announced the availability of funding that will act as a lifeline to charities and social enterprises suffering from income loss due to the COVID-19 pandemic.
The organisation has made funding available to charities and social enterprises of any size that have been unable to access grants or funding from any government emergency schemes on the back of COVID-19.
The third sector has faced significant challenges in light of the pandemic but without the same government support that was offered to businesses. Analysis by Pro Bono Economics, an independent charity, suggests that over the next six months that the sector could be set to lose over £6bn in funding. Large charities such as the National Trust, Age UK and Cancer Research UK have all reported concerning losses, but smaller charities are likely to be damaged even further, with a fifth of small charities expecting an income reduction of more than 50% over the next six months. This comes at a time when the demand for charitable services is increasing and the knock-on effect could be devastating.
Duncan Parker, Chief Executive of Fredericks Foundation said:
“1-in-10 charities are expected to close this year due to fundraising falling off a cliff on the back of COVID-19 and the complete failure of the government to support them. At the same time, most charities have seen a huge rise in demand for their services.
“Something has to give and we felt we had to help. We hope that offering accessible, responsible, not-for-profit loans to support charities through these tough times will offer welcome relief.”
Fredericks will provide loans of up to £50,000 to charities and social enterprises that have been established for at least two years. The loans will have terms of 1-3 years and an interest rate of 12%, unless they are asset-backed, in which case the interest rate will be between 8%-10%.
Fredericks Foundation is responsible finance provider that offers loans to people who want to set up, maintain, or expand a business but would usually be excluded from mainstream credit schemes. They support successful applicants long after a loan has been granted through mentoring, practical business advice, and networking support. The foundation’s mission is to build a society based on dignity not on handouts by giving individuals the tools and opportunity to reshape their lives for the better. They create choice, not charity.