A new £4m fund to invest in Wales’ social business sector has been announced by Welsh Finance Secretary Mark Drakeford.
The new Social Business Growth Fund, backed by £2.3m of EU funds, will make funding packages of up to £150,000 available to social businesses across Wales.
Managed by the Wales Council for Voluntary Action (WCVA), it will support the growth of Welsh social businesses and help develop new products, services and markets.
Professor Drakeford said:
“Social businesses make important contributions to regenerating communities and delivering local services, as well as creating jobs and enterprises, so I’m delighted to announce this support for this sector.
“This fund complements the specialist support already available through Business Wales and will help social businesses expand, pursue new opportunities and continue to play a valuable role in our economy and society.”
Investments through the fund will involve a mix of grant funding and repayable finance, with financial incentives for social businesses that exceed job creation targets.
Around 45 social businesses across Wales are expected to benefit from the fund over the next three years.
Matthew Brown, head of social investment at WCVA, said:
“We know that social businesses in Wales are dynamic and they create jobs in the communities that need them most but we also know social businesses can struggle to access the finance they need to fulfil their potential.
“The Social Business Growth Fund will help fill this finance gap by innovatively using EU funds to target financial assistance at social businesses that can demonstrate their readiness to grow. We look forward to putting this investment to work in communities across Wales.”
The investment in the Social Business Growth Fund follows this week’s launch of the £136m Wales Business Fund, which has been backed by £76m of EU funds and will offer loans and equity investments of £50,000 to £2m to small and medium-sized businesses.
Professor Drakeford added:
“EU funds are worth around £650m to Wales every year and these investments in social businesses and SMEs are excellent examples of how this important source of funding is boosting business and strengthening our economy.
“Our priority is to make sure Wales does not lose a penny of the EU funds we currently receive as a result of the UK’s exit from the EU. We are in ongoing negotiations with the UK Government for a full guarantee to ensure Wales has access to all the funding it has been allocated so businesses, people and communities continue to receive the support they need.”