Charity Bank, Senscot and Community Enterprise in Scotland are working together to create a social finance provider dedicated to Scotland’s civil society sector.

The organisation, dubbed the Scottish Community Bank (SCB), is envisaged to start life as a Scottish branch of Charity Bank, and become independent once it gains sufficient capital and profitability.

A concept paper, which outlines initial plans for the Bank, says that since devolution, it is "unacceptable" for Scotland to be a remote outpost of English-based institutions in the social banking sector.

The paper says that the Scottish Community Bank will try to source investment capital from social enterprises and large charities; local government and pension funds and charitable trusts. And it will offer a range of services, including deposit banking, lending, mortgages and investment-readiness support for Scotland’s civil society.

A seperate paper on social investment by Senscot suggests that the Scottish Community Bank could be an alternative  to Big Society Capital which it describes as "fundamentally flawed and potentially harmful to the third sector."

Aidan Pia, executive director at Senscot, said that it is currently in talks with other organisations about its plans and will have more details on the Scottish Community Bank at its annual general meeting in October.

Before then, the concept paper advises that Charity Bank will advise the FSA of its intention to upgrade its presence in Scotland in order to incubate a community bank for Scotland; and Senscot and Community Enterprise in Scotland will start dialogue with the Scottish Government.