Triodos Bank, a global pioneer of sustainable banking, has become the first bank in the UK to launch its own crowdfunding platform.
The platform (www.triodoscrowdfunding.co.uk) offers a range of crowdfunding opportunities enabling people to invest directly in equity or bonds issued by organisations delivering positive social and environmental impacts. The bonds are eligible to be held in the Innovative Finance ISA, allowing investors to receive the interest they earn on these investments tax-free.
People can invest as little as £500 – some offers will have lower investment minimums – in established charities or businesses that have been extensively screened by Triodos for social and environmental impact, the viability of their business model and the credibility of the management team.
Bevis Watts, Managing Director of Triodos Bank UK, said: “Everyday investors can make a positive choice to shape the world they want to live in. In that sense money can be a hugely powerful form of democracy if invested directly into renewable energy, social housing, charities or social enterprises. Social investment needs to be more accessible to UK investors, who increasingly recognise the power of money to create change.
“We’ve been crowdfunding since before it became a well-known term. With the new Triodos Crowdfunding platform we’re recognising the huge potential of crowdfunding and responding to demand for Innovative Finance ISAs. Investors are looking for opportunities that allow them to support progressive companies, social enterprises and charities making a positive impact, while also receiving good long-term returns.”
The platform launches with three bond offers, with interest rates ranging from 5% – 7%. The Innovative Finance ISA is available within the current £20,000 personal allowance, alongside cash and stocks and shares ISAs. As with all investments, capital is at risk.
- Mendip Renewables: aims to raise £1.8 million by 31 March to take a 5MW operational solar farm in Somerset into community ownership. Investors can earn 5% interest per year, increasing in line with the annual retail price index, repayable over 17 years. An estimated £1.4 million of profit will be contributed to a community benefit scheme over the life of the project (see notes to editors).
- Thera Trust: a charitable group of companies providing care and housing for people with complex learning disabilities aiming to raise £5 million to provide 14 new homes. Investors will earn 5.5% interest per year over a 6-year term.
- Rendesco: raising £5.5 million to develop green energy from ground source heat pumps and is paying 7% interest per year over a 7-year term. They are aiming to develop 100 sites, with a focus on retirement homes and providing low-carbon heating to keep the elderly warm.
Triodos Bank already has an excellent track record in raising finance for social and environmental organisations and in the last 15 years has raised more than £130 million to fund over 50 impact projects. In 2003, Triodos successfully raised the first charity bond in the UK for Golden Lane Housing, one of the UK’s leading supported housing landlords for people with a learning disability. In 2013, a further £10 million was successfully raised including a refinancing of the 2003 bond where over 40 per cent of bondholders re-invested.
Jeremy Rogers, Chief Investment Officer at Big Society Capital, said: “Triodos has a long history of leading the way in social impact investment in the UK, helping to improve people’s lives and their environment. We commend their plans to launch a crowdfunding platform using the Innovative Finance ISA, to enable more individuals to invest in projects that tackle the causes they care about.”
The crowdfunding platform follows hot on the heels of the new Triodos personal current account – the most sustainable personal current account ever brought to the UK market – launched in 2017. Triodos now has a full product offering ranging from everyday banking and savings to socially responsible investing and three different ISA products.
The UK has seen significant growth in impact investing over recent years, with 19.5 million people stating an interest in positive investment1. The UK’s alternative finance market covering all peer to peer lending and crowdfunding is now valued at £4.6 billion – a year-on-year increase of 43 per cent2.
Dan Hird, Head of Corporate Finance at Triodos Bank, said: “To tackle the big issues we face today we need to inspire investors to support progressive and pioneering businesses. We know the interest is there and, having seen the crowdfunding sector maturing in recent years, now feels like the perfect time to increase our presence in the ethical crowdfunding market. It aligns with our mission at Triodos Bank to make money work for positive social, environmental and cultural change.”