Microcredit business Fair Finance provides loans to financially excluded households in London and is “leading the expansion” of the microfinance sector in Western Europe, according to the latest issues of the Stanford Social Innovation Review. Established by social entrepreneur Faisel Rahman in 2005, Fair Finance needed outside capital to help become financially sustainable – which is where CAF Venturesome was able to help. Fair Finance restructured its business to allow investors with different risk appetites to invest in different parts of the business. Venturesome and other social investors provided financing for operating costs, enabling Fair Finance to access commercial finance to expand its loan book. This article highlights Fair Finance’s innovative business model and the exciting precedent it has set: “if more social enterprises like Fair Finance develop – and partner with commercial banks – financial services for disadvantaged people in the developed world could change dramatically”.
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