That the Social Finance Foundation in Ireland has endured through and beyond the Global Financial Crisis, is a testament to its relevance and sustainability. Set up when Ireland was flush with government funding, it would have been easy to see the Social Finance Foundation – SFF – fall prey to the subsequent sword of austerity and government cutbacks. That it didn’t shows that its offering is needed in good times and in bad – and that the government of the day doesn’t always take the easy route.
Established in 2007 the Social Finance Foundation represents a unique collaboration between the Government and the Irish Banking Industry. No other country has addressed social finance on a national scale and put it on a sound financial footing, capable of meeting the needs of the social sector in a very cost effective way. Funded by the Irish Banking Industry to the tune of €100m, SFF fills several critical gaps in the funding landscape.
As the wholesale funder for the Social Sector, the Foundation works through Clann Credo and Community Finance Ireland. These organisations interface with community based projects, charities, sports groups and social enterprises offering lending options in situations where mainstream loans are not an option. With nearly €60m in loans written to date, these projects generate a deep social benefit.
In 2012, the Foundation was also given responsibility for the administration of a Government funded Microfinance Loan Fund to promote job creation by supporting new and existing micro-enterprises. Microfinance Ireland was established as a subsidiary of SFF to discharge this responsibility. With over €10m approved in loans, Microfinance Ireland has provided a lending alternative to organisations that struggle to access mainstream credit. This backing has resulted in the creation of 1,800 jobs, many of these in areas of social disadvantage.
SFF has worked closely with Government Departments and agencies, in particular The Citizens Information Board and MABS to formulate a proposal for counteracting the ballooning moneylender industry in Ireland. In 2015, this became a reality. Currently being operated as a “personal micro credit (PMC)” pilot initiative, small loans are being offered in 30 credit unions nationwide. The project is being run in partnership with the Credit Union Sector, Representative bodies of the Credit Union Sector, the Department of Social Protection, Department of Finance, Central Bank of Ireland, the Citizens Information Board, An Post, MABS and Not for Profit Groups - and is open to social welfare recipients. Early indications are that there is a significant demand for low cost, simple to access credit. In addition, the use of credit as a door to financial inclusion is being explored.
Finally, as Chair of the National Social Enterprise Task Force, SFF provides strategic leadership to the area of social enterprise. Activities are at an embryonic stage but the potential job creation and social cohesion that can stem from this sector is enormous.
SFF achieves its success through a classic collaboration of non-profit, for-profit and Government. Through persistence, innovative thinking and hard work, the steps are being put in place to secure a national social finance infrastructure that provides a safety net for those who fall outside mainstream financial services. Long may this combination of political will and organisational and individual determination continue to be active in the community.