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Mixed Grant & Loan

Cost of Living Fund

Type: Mixed Grant & Loan
Value: £150k - £1.5m
Location: England
Currently open? : Yes

What is the Cost of Living Fund?

The Cost of Living Fund (COLF) provides grant funding alongside Recovery Loan Fund (RLF) loans to eligible charities and social enterprises who are supporting people in the 30% most deprived areas of England and delivering products and services to people impacted by the cost-of-living crisis. We determine this by using a measure called the Index of Multiple Deprivation (IMD), which looks at several key factors in the area. You will be able to check if you operate in a qualifying area using our Postcode Checker. Currently the grant is only available to organisations operating in IMD 1-3. 

The fund does not provide standalone grant funding. Organisations can only receive a COLF grant if they are successful in applying for a RLF loan. See our RLF page for further information on the loan. For example, a total funding package of £200k would be made of £50k grant and £150k loan. 

Who is it for?

Eligible Charities and social enterprises in England delivering products and services to people impacted by the cost-of-living crisis who are looking to: 

  • Continue their existing products or services. 
  • Increase the number of people supported. 
  • Launch new products or services. 
  • Improve the quality or efficiency of products and services. 

The organisation itself may also have been impacted by the cost-of-living crisis. However, the fund is intended to help the organisations better support people impacted by the cost-of-living crisis. The purpose of the fund is not about supporting organisations that have been impacted themselves by inflationary costs.  

Not sure if this fund is for you? Want to talk about your eligibility or any questions you have about the application process? We’re happy to help, just get in touch at: loans@sibgroup.org.uk 

The organisation must be both: 

Eligible for RLF loan, namely: 

  • Incorporated voluntary, community or social enterprise organisation*, 
  • Constituted for social benefit improving people’s lives or the environments they live, 
  • Minimum of two years’ operating activity,  
  • Minimum turnover of £400k in the last financial year (or £200k if the organisation is BAME-led** or based in Wales or Scotland) 
  • Not subject to any insolvency proceedings, and  
  • Viable borrowing proposal.  

Eligible for the COLF grant: 

  • Based in England and delivering its social/ environmental impact predominantly in England 
  • Supporting people in the 30% most deprived areas of England – we measure this by considering whether the organisation delivers most of its activity in IMD*** 1-3 – see Postcode Checker 
  • Looking to maintain, increase, launch or improve products or services to people impacted by the cost-of-living crisis 

See if you operate in a qualifying region with our Postcode Checker. Insert the postcode for where the organisation works with the largest numbers of beneficiaries/ customers. 

See the FAQs below for any ineligible items/ sectors. 

* Must be registered as a Charity, Community Interest Company or Community Benefit Society. If registered as any other legal entity, it must have a social object, asset lock and restriction on profit distribution (must distribute less than 50% of post-tax profits) written into its governing documents.  

**BAME-led = 51% or above of the organisation’s board and senior management team are from Black, Asian and Minority Ethnic communities. 

*** IMD = Index of Multiple Deprivation. In the application we will ask the organisation to provide the postcode for where they work with the largest numbers of beneficiaries/ customers. We use this to calculate IMD. To be eligible for the grant the organisation must deliver the majority of its activity in IMD 1-3. Use the above postcode checker to see if your activity falls in IMD 1-3.   

What could I receive?

Loan

Product Loan   
Amount £150k to £1.5m

(Minimum of £50k if the organisation is BAME-led**, or based in Wales or Scotland) 

 
Repayment Term 1 – 6 years
Interest Rate 7.9% per annum fixed  
Arrangement fee 2.5% on loans of £500k or greater
3% on loans <£500k
 
Repayment
  • Capital repayment holiday of up to 12 months (optional)
  • No early pre-payment fees
 
Security
  • All loans of up to and including £250k will be provided unsecured
  • For loans of over £250k, security will be taken in the form of a standard fixed and floating charge, where readily available with exceptions made only in exceptional circumstances
 
Purpose Any, including refinancing of existing debt  

Grant

Product Grant   
Amount £10k – £250k   
Grant to Loan ratio 20% to maximum of 50%
Purpose The grant money is restricted and is to be used to maintain, increase, launch or improve products or services to people impacted by the cost-of-living crisis. The grant cannot be used for refinancing of debt.   
Drawdown The grant is to be drawn down on signing alongside the loan.  
     
Period to spend grant
  • 12 months.
 
     

 

How do I apply?

RLF_How_to_apply

Click ‘Apply Now’ to start your Recovery Loan Fund and Cost of Living Fund application. 

Chat to us

Not sure if this fund is for you? Want to talk about your eligibility or any questions you have about the application process? We’re happy to help, just get in touch with SIB or one of the fund partners here: 

Social Investment Business – loans@sibgroup.org.uk 

How does the fund work?

SIB has designed the Cost of Living Fund (COLF), supported by Access – The Foundation for Social Investment, to providing grant funding alongside RLF loans to eligible charities and social enterprises delivering products and services to support people impacted by the cost-of-living crisis to help them better support these people. 

Organisations must first apply for a RLF loan. If they are eligible and suitable for the loan, they will be considered for the COLF grant. If they are eligible and suitable for the grant, a recommendation will be made to the fund’s Investment Committee to provide a blended funding package of loan and grant to the organisation. The loan element is repayable as per the above terms. The grant element is not repayable but must be spent within 12 months and can only be used to maintain, increase, launch or improve products or services to people impacted by the cost-of-living crisis. 

Cost of Living Rationale – The issues faced by the Cost of Living Crisis: 

  1. The Institute of Government published a report showing that the poorer households in the UK are the worst affected by the cost-of-living crisis because they spend a higher share of their income on energy and food, the prices of which are increasing fastest.  
  1. Multiple publications find that not being able to afford the essentials, such as food, rent, heating, or transport, has wide-ranging negative impacts on mental and physical health and well-being. These are being disproportionately felt by those on the lowest incomes e.g. lone parents, people living in more deprived areas, homeless people, people living with disabilities, older people and children.  

To ensure that the grant money is used to maintain, increase, launch or improve products or services to people impacted the most by the cost-of-living crisis the grants will be awarded alongside loans to organisations supporting people in the 30% most deprived areas of England. 

Frequently Asked Questions

What is the Cost of Living Fund?

The Cost of Living Fund (COLF) seeks to support charities and social enterprises working to address the cost-of-living crisis, by providing grant funding to eligible organisations alongside the RLF loan.

The target audience is eligible UK charities and social enterprises based in England, Wales and Scotland who are improving people’s lives, and already working to support people impacted by cost-of-living.

The fund is managed by SIB and supported by Access – the Foundation for Social Investment’s Cost of Living programme.

Who is the Cost of Living Fund for?

The COLF grant aims to fund organisations delivering products and services to support people impacted by the cost-of-living crisis.

The main aims of the fund are:

· Fund organisations already supporting people impacted by the cost-of living crisis and delivering the most acute cost-of-living related solutions.

· Fund organisations to maintain or continue services to people impacted by the cost-of-living crisis that would otherwise need to be cut; and/ or increase or launch new services to meet increased demand and significantly expand cost of living support.

Unfortunately, this fund cannot be used to support organisations that have been impacted by inflation themselves). If you yourself have been affected by the cost-of-living crisis, you may still be eligible to apply for an RLF loan to help with these costs but you will not be eligible to receive a COLF grant.

Do we have to meet all eligibility criteria?

To be eligible for this fund, you must meet all of the criteria for the Recovery Loan Fund, namely:

· Incorporated voluntary, community or social enterprise organisation*,

· Constituted for social benefit improving people’s lives or the environments they live,

· Minimum of two years’ operating activity,

· Minimum turnover of £400k in the last financial year,

· Not subject to any insolvency proceedings, and

· Viable borrowing proposal.

As well as meet the following COLF criteria:

· Based in England and delivering your social/ environmental impact predominantly in England.

· Delivering most of your activity in IMD** 1-3.

· Looking to maintain, increase, launch or improve products or services for people impacted by the cost-of-living crisis.

* Must be registered as a Charity, Community Interest Company or Community Benefit Society. If registered as any other legal entity, it must have a social object, asset lock and restriction on profit distribution (must distribute less than 50% of post-tax profits) written into its governing documents.

** IMD = Index of Multiple Deprivation.

How can I find out what IMD number my organisation works in?

You can check the IMD number of the primary postcode your organisation operates in here. 

How will my eligibility for the Cost of Living Fund be assessed?

There are no further application forms or questions for this fund. Instead, your eligibility for the COLF will be reviewed by your relationship manager, as part of the regular assessment process, and if you’re eligible, they will work with you to apply for an amount that reflects your needs.

Can I have this grant without the Recovery Loan Fund loan?

No. This fund is discretionary and is available to eligible organisations alongside a loan from the RLF loan only. The fund is not intended to provide standalone grant funding.

My organisation already has an active RLF loan, can I receive this funding?

Unfortunately, this grant funding applies to new RLF loans only.

Can you explain further how the combined loan/grant (blended finance) works and what the process is?

The product you are applying for is the Recovery Loan Fund with the addition of grant support from the Cost of Living fund. The COLF grant can provide up to 50% of requested loan amount (capped at £250k) and your Relationship Manager will work with you to create an application that reflects your need.

Is the funding received as a lump sum or staggered?

The Grant is dispersed as a lump sum alongside the drawdown of the Loan. It is not usually staggered in any way.

I want to use the funding to refinance existing debt, is this allowed?

No, whilst your RLF loan can be used to refinance existing debt, it is not permitted to use the grant portion from the Cost of Living Fund for this purpose.

Is anything ineligible?

The following sectors are ineligible:

· Deposit taking Banks and EEA Banks;

· Building Societies;

· Insurers (other than insurance brokers);

· Public sector organisations (as classified by the Office of National Statistics);

· State funded primary or secondary schools.

Is there either a closing date for applying or will the fund be closed once a certain number/value of applications are received?

As it stands, we have £1.5 million to cost-of-living grant support available which will be awarded on a first come first served basis. This grant add on will either cease once all of this money has been invested, or by 31st December 2024, unless we decide to extend the fund. The SIB website will be kept up to date with any deadlines or updates to the fund.

What should I expect when completing the application form?

The application is relatively straight forward and follows the same format as the standard RLF application. It collects mostly contact information and organisation data. It doesn’t have lots of free text questions.

You will also be asked to provide your last 2 sets of approved accounts (showing figures for 3 years, if available), latest set of management accounts, and 12-month cashflow forecast for the current financial year.

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