Social Investment Scotland has reported its customers have seen their turnover and the number of jobs they provide increase for the fifth year in a row
A social finance body that provides loans to social enterprises and other third sector organisations has reported its customers have increased their turnover and the number of jobs they provide for a fifth consecutive year.
Social Investment Scotland (SIS) clients created 363 new jobs while sustaining more than 3,000 positions in 2015/16.
Collectively, the turnover of SIS clients reached an impressive £192 million for the year, an increase of £20 million on the previous years and more than four times its client turnover in 2012 of £47m.
The last five years have seen many more social enterprises wake up to the potential of social investment in helping them deliver their social goals
Researchers who filed the statistics as part of the SIS 2016 Social Impact Report report looked at 118 customers comprising social enterprises, charities and community organisations.
They declared Scotland’s social economy is thriving.
Nearly two thirds of those asked said they believe that they have increased their financial sustainability over the previous year, and roughly the same number felt confident they would be able to grow the scope or scale of their activities.
Despite one in four of their customers living in the bottom 15% most deprived areas of Scotland, average turnover of SIS clients has nearly doubled from £843,000 in 2012 to £1.6m now.
The report also finds third sector organisations are becoming less reliant on grant funding.
The percentage of customers SIS has that don’t receive any grant funding has increased from 12% to 18%. Furthermore, the percentage of customers with more than 50% of their income generating from trading activity, has increased from 43% to 62%.
Established in the 2001, SIS has invested over £50m through loans from £10,000 to £1m in organisations across Scotland. Since publishing its first report back in 2012, it has supported 237 customers and provided 333 loans.
Alastair Davis, SIS chief executive, said over the past five years SIS has been evolving as an organisation to offer services more akin to a business adviser, mentoring and nurturing customers throughout their journey rather than just focusing purely on financial support.
“The last five years have seen many more social enterprises wake up to the potential of social investment in helping them deliver their social goals,” he said.
“No longer solely reliant on grant funding, many of these organisations are taking on investment to help increase trading income which, in turn, is helping them to increase their local social impacts and support thousands of jobs.
“I’m proud that our focus on supporting the most marginalised communities has remained unchanged, and we have also been able to maintain our high service standards, as judged by our customers.”
Fraser Kelly, chief executive of Social Enterprise Scotland, the membership body for Scotland’s social enterprises said the report proves demand for social investment appears to be strengthening.
“The social investment arena in Scotland has been a source of innovation for some time now and the SIS report shows that there is a willingness to design different types of support to respond to market demand,” he said.
However he warned: “Across the broad social investment arena issues of price, terms, management arrangements and investor/investee compatibility still need to be tackled."
