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Barclays to match modernisation fund loan money

Finance | Tania Mason | 17 Jun 2009

Barclays Commercial Bank is to provide £9.5m to match the allocation of the government’s modernisation fund being delivered through Futurebuilders England.

The Modernisation Fund was set up by government to help voluntary sector organisations better withstand the recession and be able to continue to provide services to those people worst affected by it.

The £16.5m fund, comprising loans and grants, was announced as part of the government’s £42.5m sector action plan published in February. Delivery of the fund is being shared by Capacitybuilders (£7m) and Futurebuilders (£9.5m), with the former handing grants to smaller organisations and Futurebuilders administering loans for larger bodies.

Barclays will work with Futurebuilders, on a case-by-case basis, to provide loans to sector organisations. If charities require more than the Modernisation Fund’s £500,000 loan limit, Barclays will look to provide the additional funding required.

Its allocation will bring the total loan fund to £19m.

The bank will also offer professional support to lendees on how best to structure their finances and it will help to organise and jointly run seminars designed to give charity finance teams’ guidance, support and the financial understanding to support their borrowing.

The funding will help in two main ways:

• Bursaries of £1,000 for organisations to pay for initial advice on how they can become more resilient and work more closely with others to increase their impact, and grants of up to £10,000 to help pay costs involved in moving towards collaboration or merger.
• Interest-free loans of between £30,000 and £500,000 for third sector organisations with existing plans for mergers and collaboration or other activities to help them prepare for difficult times.

Jon Mosscrop (pictured), head of charities at Barclays Commercial Bank, said that by providing the management advisory expertise as well as financial support, sector organisations will be "better equipped to withstand the economic challenges they may currently be facing, and also increase their competitiveness and be ready to maximise their opportunities for growth when the economy recovers.”

For more information see www.modernisationfund.org.uk or call 0191 269 2277.

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Who's Who: Tania Mason