The Resilience and Recovery Loan Fund: Three things you need for a successful application

17 September 2020

Thinking of applying for the Resilience and Recovery Loan Fund? With just under two weeks before the deadline on 30 September, our Director of Enterprise and Development Rob Benfield shares three things you’ll need to focus on for your application.

Since launching the Resilience and Recovery Loan Fund (RRLF) at the end of April, we have been able to support a wide range of charities and social enterprises with investment. While loans are not the right option for all organisations, for some, the current offer has helped to strengthen the vital services they deliver through the pandemic, increasing their resilience for the recovery.

To date, RRLF has approved funding of close to £10m to 25 charities and social enterprises, including £0.5m of grants. Organisations with funding approved have included Acorn Early Years Foundation, Big Issue and the Royal Society for Blind Children. The team and our experienced social investor partners -  are working hard to ensure the money gets to where it is needed fast with quick turnaround times.

Watch the case study below to hear about how a loan from RRLF helped strengthen Acorn Early Years Foundation’s cashflow through the current crisis, allowing them to look forward with confidence to the next 6 months.

We’re also being open and transparent about our decision-making on the Fund, and which kinds of organisations are applying to our funds and programmes, but also where they are and who leads them to ensure we’re investing where it’s most in need with our weekly Dashboard – which publishes real-time social investment data.

If you’re thinking RRLF might suit the needs of your charity or social enterprise, there are just two weeks left to submit your application and take advantage of the current offer – the deadline is 30 September.

So, with that in mind, we are here to help you through the process of what’s needed for your application: here are three things you will need for a successful one.

  1. Eligibility

To be eligible to apply for funding through RRLF, your organisation’s legal form must be in line with Big Society Capital's governance principles.

Eligible applicants will:

  • be included on the list of qualifying entities (see Appendix 1 in the Fund Guidelines).
  • if a Company Limited by Guarantee or a Company Limited by Shares, have Social Objects in its Articles.
  • have been operating for a minimum of two years.
  • have a minimum turnover of £400k.
  • have a turnover of less than £45m (whole group – if applicable).
  • have more than 50% of income from trading activity (whole group – if applicable). This eligibility criteria does not apply to registered charities and further education colleges.
  • trade in the UK and the loan will be used to support trading in the UK.
  • be able to confirm that the organisation has been adversely impacted by COVID-19.
  • be able to demonstrate that the organisation has a “viable” business proposition.
  • be able to demonstrate that the organisation was not an “undertaking in difficulty” as at 31 December 2019.
  • be able to demonstrate that outcomes of the product or services provided are specifically relevant to improving people’s lives, even if improving people’s lives is a secondary outcome area of your organisation.

Further detail on eligibility criteria can be found in the Application Guidance (available to download at the bottom of the Fund page under 'Attached Files'). We recommend you read this document in detail, paying close attention to the eligibility section, before completing your application form.

  1. Viability

During the application process, we must establish that your organisation has a viable business proposition. This is assessed according to our normal lending criteria and in line with regulatory obligations. If there are some concerns over the short-to-medium term performance of your organisation due to the uncertainty and impact of Coronavirus, we will be looking to assess (a) that the loan will help your organisation trade-out of any short-to-medium term cashflow difficulty, and (b) if the loan is granted, your organisation should not go out of business in the short-to-medium term. This approach to assessing viability will be undertaken in detail if your application goes through to full assessment. Organisations that have had to temporarily stop trading but have ongoing costs to maintain the business are eligible to apply, if they can demonstrate that they are viable.

If your organisation is based in and delivering the majority of its impact in England, and you have concerns about your viability for the loan, you may be eligible for a grant alongside your loan.

Grants will only be awarded alongside a loan if it is clear that the COVID-19 interruption to an organisation’s business model means that they would struggle to meet a viability threshold for a loan without the grant. In this sense, the grant enables use of the loan fund – it is hoped that this will widen the reach and accessibility of the fund. Assessed on a case by case basis alongside the loan, grants that are awarded will range in size from £40k - £300k and can be 20% to 40% of the loan amount. During the assessment stage additional information may be requested to complete a grant assessment alongside the loan assessment.

  1. Impact

This is an important one. RRLF is only for social sector organisations: charities and social enterprises that are improving people’s lives across the UK. Our initial investor is Big Society Capital - their remit (under Dormant Accounts Act) is to invest money in organisations that 'exist wholly or mainly to provide benefit for society or the environment'; so any organisations need to be able to meet what is set out in Big Society Capital's governance principles. With your application, you will need to make a strong impact case for your organisation – with a focus on the detail of how it improves people’s lives and how your delivery has been adversely affected by COVID-19.

If you have any other questions regarding your application, please do get in touch with the team here on RRLF@sibgroup.org.uk, and if you think RRLF could suit your organisation’s needs, please do apply before the deadline to and avoid missing out on the current offer.

 

Apply Now

Photo by Markus Winkler on Unsplash

Rob Benfield

Director of Enterprise and Development

Rob joined Social Investment Business (SIB) in January 2019 having spent 12 years working across both the commercial and social funding sectors.  

Prior to joining SIB, Rob was a member of the Senior Management Team of the UK microfinance organisation Fair Finance, where he helped it to expand nationally over a 5 year period. 

The earlier parts of Rob’s career were spent at HSBC where he worked in a number of roles across retail, commercial and corporate banking.This included working internationally to launch financial products in emerging markets.

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