The Resilience and Recovery Loan Fund: last-chance CBILS loans for charities

Charities have been hit hard by the COVID-19 pandemic for the past year, at a time when their role in supporting our most vulnerable communities has never been more needed.

On top of these exceptional circumstances, social sector organisations have faced difficulties in accessing the finance they need to survive.

The Resilience and Recovery Loan Fund (RRLF) is a £25m fund for social enterprises and charities that are improving people’s lives across the UK who are experiencing disruption to their normal business model as a result of COVID-19. The Fund was established in April 2020 to make an existing government scheme (the Coronavirus Business Interruption Loan Scheme (CBILS) more easily accessible to charities and social enterprises. In August 2020, £4m worth of grants was made available from Access – the Foundation for Social Investment – for organisations based in England. Introducing this blended finance solution to RRLF helped to widen the accessibility of the Fund to organisations who would otherwise struggle to meet the viability threshold for a loan.

To date, RRLF has approved funding of over £22m to over 60 charities and social enterprises, with around £7m in funding left. Of the current total, over £19.5m worth of loans and over £2.8m worth of grants have been approved. The Fund closes to new applications on Wednesday 31 March at 11.59pm.

Since RRLF launched last April, Social Investment Business (SIB) and our partners (Big Issue InvestCAF VenturesomeCharity BankResonanceSocial Investment ScotlandSocial and Sustainable Capital and Wales Council for Voluntary Action) have been able to support a wide range of charities and social enterprises with investment through RRLF. 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.

We know from the Chancellor’s Budget last Wednesday that the CBILS scheme will not continue in its current form. The CBILS successor loan scheme – the Recovery Loan Scheme (RLS) – offers an 80% government guarantee for lenders, but fees for the first year will no longer be covered, so if you wish to benefit from the government paying all interest and fees for the first 12 months, you need apply for a CBILS loan before the 31 March to take advantage.

So, with that in mind, what does the current time-limited offer from RRLF look like for charities?

Key features of the Fund also include:

  • Funding packages from £100k to £1.5m
  • Loans available from 1 to 5 years
  • Assessed on a case-by-case basis alongside the loan, grants that are awarded range in size from £40k – £300k and can be 20% to 40% of the loan amount.
  • All loan interest and fees covered by the government for the first 12 months
  • All loans come with a 12-month capital repayment holiday and no early repayment fees
  • Loans up to £250k unsecured, and above that a simple fixed and floating debenture will be taken
  • All purposes considered except refinancing existing debt.

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.

Organisations with funding approved from RRLF have included Action on Hearing Loss, Autism Plus and Big the Royal Society for Blind Children (RSBC). Watch the video below to hear about how a loan from RRLF helped RSBC to increase their impact, rather than cut back on their delivery.

Autism Plus, a charity working in the North East of England supporting people with complex learning and health needs, received a £360k loan and a £140k grant (alongside the loan). They applied for a £500k loan to pay for a new IT system to enable them to pivot their business model and deliver costs savings through efficiencies. Although the organisation needed the full £500k of funding, we assessed that the organisation could only afford to repay a loan of £360k and therefore awarded the other £140k as a grant. Watch the video below to hear Autism Plus’ organisational story so far.


How to apply

If you’re thinking RRLF might suit the needs of your charity or social enterprise, you can find out more and apply here. The deadline to submit applications is 31 March 2021.


This commentary was written by Rob Benfield, Director of Investments, Social Investment Business

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