Growing financial investments in communities
The Community Investment Fund (FIC, in Spanish) of the Fundación Comunitaria de Puerto Rico (FCPR) granted $290,000 in loans in 2017 to two nonprofit organizations (NPOs). In 2018, the amount granted stood at $992,219 in loans to four organizations, for a combined social investment in both years of $1,282,219.
The FCPR established the FIC in 2016, as an innovative financing program that provides access to capital to NPOs to activate community economic development. Eligible activities include: capitalizing community loan programs; buying and rehabilitating social interest housing; obtaining operational capital; and, financing projects that generate economic and social results.
The instrument is similar to funds created in the U.S. mainland by community foundations, through self-funding. The FCPR made a first injection of $500,000 and was followed by other investors: Ángel Ramos Foundation; Banco Popular; Scotiabank; First Bank; Oriental Bank; and Banco Santander (2016-2018).
The FIC represents a unique opportunity for nonprofits since interest rates are low, repayment terms are easy, and the entity is provided with financial and administrative advice, and support to control the risk.
“The FIC has been an innovative instrument for nonprofit organizations to gain access to financial capital. This serves several goals: the generation of economic activity through jobs created and retained, and suppliers that are commissioned; it gives organizations and investors a vehicle to obtain a financial return; and it provides results for the community through the services and programs the organizations offer,” said Vice President of Program and Administration, David Haddock.