Closed Fund

Hybrid Social Finance Loan 2023 – 2024 – Round 2

In partnership with:

The Hybrid Social Finance Loan is a partnership between Rethink Ireland, Community Finance Ireland and the Department of Rural and Community Development via the Dormant Accounts Fund. It aims to build the capacity of social enterprises that are first-time borrowers. The first open call took place between mid May and early July 2023. This time we are inviting social enterprises to our second open call. 

This unique new financial instrument will provide a mix of a loan that must be paid back, along with a non-repayable loan and business support for up to 20 social enterprises in total. The Department of Rural and Community Development via the Dormant Accounts Fund has committed €890,000 for this Fund. In addition, Community Finance Ireland will provide approximately €500,000 in repayable loans.

At present, there is a lack of investment readiness among social enterprises and there is no tailored financial instrument that fits the needs of the growing social enterprise market. The Hybrid Social Finance Loan aims to tackle these gaps following extensive research on financial instruments for social enterprises in Ireland and consultation with the sector.   

A key requirement for applicants is that their social enterprise must not have borrowed money before. Start up social enterprises and/or those that have less than 5 years trading would have an advantage over other applications.  

Each Award will include: 

  • A total loan of between €20,000 and €100,000 which includes
    a) A repayable loan between €10,000 and €50,000 provided by Community Finance Ireland which can be financed over five years at a competitive rate.
    b) A non-repayable loan for up to the same amount provided by Rethink Ireland upon delivery of agreed milestones. It will be paid in two instalments, over a period of one year, at the start and end of the six month capacity building programme. 
  • Capacity building supports for the amount of €10,000 provided by Rethink Ireland which includes tailored Business support and a place on a six month Rethink Ireland Accelerator Programme.
    – Business support will focus on improving the investment readiness of the selected social enterprises. Business support will be tailored to the specific needs of each social enterprise and carried out by approved consultants.
    – Rethink Ireland’s Accelerator is a unique offer, equipping Awardees with the skills needed to expand and deepen their impact. It provides training from best-in-class experts across the private, nonprofit and public sector. Training is provided across a range of functions and may include Impact Management, Communications, Sustainability and Strategy, Equality, Diversity and Inclusion.

For any questions you may have please contact hybridsocialfinance@rethinkireland.ie

Who can apply?

What is a social enterprise?

As per The National Social Enterprise policy 2019-2022:

A Social Enterprise is an enterprise whose objective is to achieve a social, societal or environmental impact, rather than maximising profit for its owners or shareholders.

It pursues its objectives by trading on an ongoing basis through the provision of goods and/or services, and by reinvesting surpluses into achieving social objectives.

It is governed in a fully accountable and transparent manner and is independent of the public sector. If dissolved, it should transfer its assets to another organisation with a similar mission.

Eligibility & Criteria

Projects must meet both Rethink Ireland’s criteria and the specific criteria for the Hybrid Social Finance Loan, as set out below:

Rethink Ireland Criteria 

  • The project must address a critical social issue
  • The project must be innovative in an Irish context
  • The project must be based on the island of Ireland and make its main impact in the Republic of Ireland.
  • The project must have the potential and desire to scale or replicate in Ireland.
  • The project must provide evidence that it is up and running, or be tested at least in a minimal way.
  • Applicants must come from an entity that has a not-for-profit legal form, e.g. a company limited by guarantee, a trust, a co-operative or other not-for-profit legal forms*

*If you have another legal form, but meet the definition of social enterprise under the National Social Enterprise Policy for Ireland, the Fund may be able to support you. Please contact hybridsocialfinance@rethinkireland.ie  if you have any questions.

The Hybrid Social Finance Loan Core Criteria 

  • Social enterprises
  • First-time borrower as a social enterprise and unattractive to mainstream traditional finance
  • Have some trading record and able to demonstrate traded income to date
  • Have repayment capacity to repay the repayable loan provided by Community Finance Ireland 
  • Must be up and running
  • Tangible and measurable social impact

Advantageous criteria 

The criteria below will be considered advantageous in applications, however, organisations that  meet the core criteria but do not meet the advantageous criteria are encouraged to apply. 

Projects incorporating any of the below in their application will have an advantage:

  • Social enterprises that are start ups
  • Social enterprises that have less than 5 years trading

Which projects cannot apply?

Projects that are not eligible to apply are:

  • Projects where research is the primary activity
  • Projects seeking to use the non-repayable loan for large capital items (such as buildings, vans, renovations or land). The repayable loan provided by Community Finance Ireland can be spent in line with the social enterprise’s needs including capital investments, following approval from Community Finance Ireland.
  • Projects promoting or aligned with a political party
  • Projects that only accept participants of a particular faith or religious denomination
  • Projects focused on animal welfare 
  • Projects based outside the Republic of Ireland
  • Projects led by people under 18 years of age
  • Projects that are an idea (only) and that have not yet started

Which applicants cannot apply? 

Applicants that are not eligible to apply are:

  • Applicants under 18 years of age
  • Commercial companies, sole traders and individuals
  • Any staff member from Rethink Ireland, Community Finance Ireland and the Department of Rural and Community Development staff, Directors and their family members. Family members include siblings, parents, spouses or civil partners or children.
  • Individuals, statutory or public bodies, local development companies, LEADER companies, companies limited by shares, and organisations that are funded 100% by state bodies or agencies and continue to be in receipt of that funding.
  • Any consultant currently working with Rethink Ireland.

If my organisation has previously received an award from Rethink Ireland, can I still apply?

Yes. If you have previously been funded by Rethink Ireland, you can still apply. Previous awardees must be able to demonstrate they have performed well on a previous programme and capture in the application form how the new funding being applied for is a logical continuation from the original investment, fitting the new Fund criteria in particular.

If my organisation is currently in receipt of an award from Rethink Ireland, can I still apply?

Projects on one of our Funds that have cash grant payments remaining before the commencement of the new fund programme are not eligible to apply. 

Organisations on one of our Funds that have cash grant payments remaining before the commencement of the new fund programme are still eligible to apply with a different project and different project lead.

Can I apply for this funding even though I am still in the ideation stage? 

Unfortunately no, your social enterprise must be able to demonstrate some traded income to date.

What do you mean by innovation?

At Rethink Ireland, we define social innovation as the successful delivery of new approaches to meet social needs more effectively and sustainably than those currently available. It can include existing work which is done in creative, different, and dynamic ways, or in a new locality.

Just as innovation is necessary for economic growth, we believe innovation is critical to societal and economic progress. 

If my organisation is funded by a Government/state agency (HSE, TULSA etc) are we eligible? 

Yes, you can apply if you are in receipt of funding from a government or state agency. However, if your organisation is 100% funded through state sources then you are not eligible to apply to the Fund.

Is it possible for organisations to collaborate in an application (e.g. a community development organisation and an educational provider)?

They can and one organisation should take the lead. Please refer to the eligibility criteria to ensure that your application is eligible for funding.

What does the Fund offer?

The Fund will offer up to 20 start-up social enterprises a combination of a loan that must be repaid, a non-repayable loan and a business support package, to help them expand and increase their social impact.

This includes:

  • A total loan of between €20,000 and €100,000 which includes
    • A repayable loan between €10,000 and €50,000 provided by Community Finance Ireland which can be financed over 5 years at a competitive rate. 
    • A non-repayable loan for up to the same amount provided by Rethink Ireland upon delivery of agreed milestones. It will be paid in 2 instalments, over a period of 1 year, at the start and end of the 6-month capacity building programme. 
  • Capacity building support to the value of €10,000 provided by Rethink Ireland which includes:
    • A place on 6-month Rethink Ireland’s Accelerator Programme equipping Awardees with the skills needed to expand and deepen their impact, delivered by best-in-class experts across the private, nonprofit and public sector
    • Bespoke business and capacity building support focusing on improving the investment readiness of the selected social enterprises, tailored to the specific needs of each social enterprise and carried out by approved consultants, designed in consultation with the successful projects on topics such as strategic planning, maximising your impact, communications, storytelling and fundraising.
  • Access to Rethink Ireland’s networks and have the opportunity to develop networks and contacts with the other Awardees on the Programme which are often very valuable in the longer term.

* Community Finance Ireland will decide on the repayable loan. Rethink Ireland’s Board will make the final decision on the non-repayable loan amount but generally, it will be for the same amount of the repayable loan. 

What can the Hybrid Social Finance Loan be spent on? 

The non-repayable loan provided by Rethink Ireland may be used to cover operations/staff costs (working capital) and up to  50% on equipment. It cannot be used to pay off debts or for large capital items such as renovations, or for vehicles, land or  buildings, or to fund research.

The repayable loan provided by Community Finance Ireland can be spent in line with the social enterprise’s needs, including capital investments, following approval from Community Finance Ireland. Applicants will submit a budget as part of their application and must be able to demonstrate in your application how this is facilitating your Social Enterprise. 

What is expected of Awardees?

The project lead will be expected to take part in the six-month Accelerator Programme, which includes attending approximately 6 workshops and spending time working 1:1 with a business/strategy consultant.

How do we apply?

Applications to the Hybrid Social Finance Loan are now closed. 

If you have already applied, the next stages of the process are as follows:

  • Open call for applications (25th September – 8th December 2023 )
  • Eligibility Review (December 2023)
  • Internal and External Reviews, applications are assessed based on impact, innovation, scalability, sustainability (January 2024)
  • Due Diligence/Governance checks on shortlisted applicants (mid January and early February 2024)
  • Financial Review performed by Community Finance Ireland  (February – April 2024)
  • Final decisions by Rethink Ireland’s Board (end of April 2024)

Who will decide who wins the awards?

All applications will be reviewed thoroughly through a rigorous process. The Board of Rethink Ireland will make the final decision on successful applicants and the number and value of the final non-repayable loan, while Community Finance Ireland  is responsible to issue a loan letter to the selected Awardees for the repayable loan given.

How do applicants find out where they are in the selection process?

We will contact all applicants by email to let them know whether or not they have been shortlisted. When final decisions have been made on the successful applicants, we will contact all shortlisted applicants by phone or email to let them know whether they have been successful. 

 

Terms and conditions of the Fund

By applying for The Hybrid Social Finance Loan, you agree to the following terms and conditions.

  • You are 18 years of age or older.
  • You have given full and truthful information, both verbal and written, at all stages of the application and selection process. 
  • You are eligible to apply. This means that your organisation meets the criteria for Rethink Ireland and, as described.
  • You have the right to apply. This means that you hold the necessary rights to carry out the project.
  • By sending in your application, you accept these terms and conditions and our Privacy Statement. If you do not comply with these terms and conditions, you may be disqualified and may have to return any award granted. 
  • Rethink Ireland will hold the personal details which you submitted with your application form. We will only share this information with the third parties administering the application and selection process unless we agree otherwise with you. Please see our Privacy Statement for full details.
  • The Awardees must take part in publicity about the grant. Rethink Ireland reserves the right to publish the names of organisations that are successful in their applications.
  • If you decline an award or if the award is taken back because you did not comply with the terms and conditions, the Directors may select an alternative Awardee.
  • Rethink Ireland reserves the right to disqualify any entrant, to change the terms and conditions without notice, or to cancel the application process at any stage.
  • Where relevant, applicant organisations must be fully compliant with guidelines, regulations and legislation applicable to their project, for instance, Children First guidelines and child protection regulations.
  • You consent to the Government of Ireland Statement on Public Finances if selected as a winning applicant.

Please contact hybridsocialfinance@rethinkireland.ie should you require further information.