This website uses cookies

We use cookies and other tracking technologies to assist with navigation and your ability to provide feedback, analyse your use of our products and services, and assist with our promotional and marketing efforts. View our Privacy Policy

ART Business Loans

Financial performance

ART Business Loans has a strong Balance Sheet and track record, including repayment of all loans made by banks and others over 20 years in line with terms and conditions.



Benefits of Investing in ART

Dr Steve Walker, Chief Executive of ART Business Loans, talks about the social and financial benefits to investors of ART's Community Share Offer.

Track Record

At start up in 1997, ART Business Loans raised grant funds from several sources to cover revenue costs – staff, marketing and rent etc. The major providers were Barclays, NatWest, Investors in Society and Birmingham City Council.  As scale increased, income generation from interest and fees was able to cover all the overheads of the business, excluding bad debts.

Initially, capital for lending was obtained from a share issue to investors who invested for purely social purposes, raising about £360,000. Investors included large private sector companies, major banks, housing associations, local and national government, trust funds, high net worth individuals and other individuals wanting to put their money to work for a social purpose and support the economy in the area that ART Business Loans served. They received no financial return.

Since launch, ART Business Loans has been supported by local, national and European public sector funding, including the Phoenix Fund, the Regional Growth Fund and the European Regional Development Fund. The major loan provider to ART Business Loans has been, and continues to be, Unity Trust Bank.

Following the closure of the Regional Growth Fund in 2015, ART Business Loans and other CDFIs were encouraged to seek funding for their activities from local public sector sources. ART Business Loans has established, with support from Birmingham City Council, Unity Trust Bank,ThinCats peer lending platform and loan investors using that platform, a targeted Birmingham Small Business Loan Fund to provide loans totalling £1 million a year for three years to March 2020. This commenced in the financial year 2017/18.

All loans made to ART Business Loans (to date in excess of £10m) have been for capital to lend to businesses and social enterprises and have either been fully repaid or are still being serviced in line with terms and conditions.

Performance History

ART Business Loans performance for the three financial years ended 31st March 2019 is summarised below:


Lending reduced in 2017 due to delays in agreement as to the recycling of loan receipts for the CDFI sector from the Regional Growth Fund (RGF) and, in ART Business Loans’ case, there were no other available funds for lending at that time. Since then, RGF recycling has been agreed and is planned to continue until all RGF grant funds have been exhausted. The Birmingham Small Business Loan Fund was established from the financial year ending 2018 and will run until the financial year 2020. This increased ART Business Loans lending for the financial year ending 31st March 2018 back up to £2.5m, which was also achieved in the financial year ending 31st March 2019.

Investment Illustration

The forecast of how a capital investment of £500,000 in ART Business Loans will be available for repayment to investors should they choose to withdraw their investment at the end of the five-year investment period is as follows:


The principal assumptions underlying this illustration are as follows:

  • For the purpose of this illustration the investments through this offer are treated as being received on 1st April 2020.
  • All the capital will be lent to small businesses and social enterprises in the first year. We anticipate that the portfolio will be approximately 15 term loans, with an average value of approximately £34,000.
  • The loan terms will be on average around 54 months, thereby ensuring that there will be sufficient capital realised at the end of five years to repay those investors who choose to withdraw their investment at this point.
  • Capital receipts from the loans made will be ringfenced to be available to redeem the shares after the 5 year investment period.
  • Bad debts of 16% are assumed for the portfolio. The loans will either be secured through tangible security in the form of a legal charge over property or where this cannot be provided by the borrower, the Enterprise Finance Guarantee scheme will be used.
  • The income ART Business Loans earns from the loans is in the form of arrangement fees and interest. This income is used to pay running costs and to make up any shortfall in the capital due to investors. In the above illustration a shortfall of £30,000 is anticipated and £6,000 per year is transferred to the capital fund from income earned on the loans.

Need help?

The Ethex team are here to help from 9am to 5pm

Invest and save with Ethex to

make money do good

You can browse, compare and invest in a range of products on Ethex platform from bank accounts and ISAs to equity investments and charity bonds that offer a social/environmental as well as a financial return. All you need to do is get started...