Today (Thursday 14th September), Big Issue Invest (BII), the investment arm of the Big Issue Group (BIG), is calling for applications to its Social Impact Debt Fund IV (“Fund IV”). Fund IV is a private debt fund, which will lend to organisations across the UK looking to grow their social impact.
The fund will focus on three core sectors – health and social care, affordable housing and social infrastructure (for example co-working spaces, education & training, nurseries and arts organisations). The fund seeks national exposure with an emphasis on areas of poverty and deprivation within the three core sectors.
Poverty and poor health create a vicious cycle, with 1.6 million people in England aged 65 years and over with unmet care needs. Fund IV intends to partner with health enterprises that can provide innovative solutions to improve health outcomes and break this cycle.
Affordable housing is another critical area of focus for Fund IV, as there are currently 274,000 homeless individuals in UK, including 126,000 children. Currently, there are also over 1.2 million households on social housing waiting lists. Housing costs play a significant role in perpetuating poverty, with 46% of social renters experiencing the highest rate of poverty. Fund IV aims to support organisations that can provide affordable housing solutions and help alleviate homelessness.
The fund also recognises the importance of social infrastructure in addressing poverty and inequality. Communities suffering from high deprivation often lack public spaces, cultural engagement opportunities, and active populations. Fund IV seeks to lend to organisations that improve social infrastructure, such as community centres, shared workspaces, arts performance venues, nursery provision and educational institutes.
The fund provides loans in the £1m – £4m range, typically backed by property assets and where BII will be the sole lender. The loans will be fixed rate and repayable over 3 to 5 years. Borrowers will be established, socially impactful organisations, with a history of profitable revenue generation.