RSF Social Finance Introduces Social Investment Fund Notes Offering Higher Interest Rates
Aug 21 2023
New Notes expand options for investing in high-impact social enterprises; community pricing model also evolves to engage more investors and borrowers
SAN FRANCISCO, Aug. 21, 2023—RSF Social Finance has introduced new Social Investment Fund
Notes* that give investors more opportunities to invest directly in deep impact. Like RSF’s long-standing Quarterly Note, the new Notes fund loans to enterprises achieving positive social and environmental returns, but they offer higher annualized interest rates for longer-term commitments.
Options for investing in the Social Investment Fund now are:
- 3-Year Note: 4% interest, minimum $25,000 investment
- 2-Year Note: 3% interest, minimum $25,000 investment
- 1-Year Note: 2% interest, minimum $25,000 investment
- Quarterly Note: 1% interest, minimum $1,000 investment
Jasper van Brakel, CEO of RSF Social Finance, said the new Notes respond to investor demand and fill a gap in impact investing options.
“RSF has decades of experience in lending to for-profit and nonprofit enterprises with significant positive social, cultural, and environmental impacts, and our Quarterly Social Investment Fund Note has long been one of the few ways people could invest directly in these enterprises,” van Brakel said. “The new Notes allow patient investors seeking higher rates to fund these types of loans alongside people who prioritize liquidity.”
The Notes also respond to borrower demand, he said, citing RSF’s robust pipeline of enterprises seeking mortgage, construction, and equipment loans, as well as working capital lines of credit. The organization has experienced significant growth with lending to enterprises focused on climate action, clean energy, and social justice.
Community Pricing Model Gets an Update to Include More Voices
In concert with the introduction of new Social Investment Fund Notes, RSF has updated the community pricing model that determines interest rates for borrowers and investors. Since 2009, when RSF abandoned LIBOR and introduced RSF Prime, the organization has used a revolutionary stakeholder-centered approach to set interest rates. This approach, involving borrowers, investors, and RSF staff, makes interdependency visible—and it has remained effective even during severe economic downturns.
The challenge has been engaging a representative sample of the RSF community: Community pricing gatherings typically drew a very small segment of borrowers and investors. As a way to bring in more voices, RSF has shifted to borrower and investor surveys to get a better sense of their respective needs and the community’s economic reality and thoughts on pricing. The decision followed a pilot survey that resulted in feedback from a much larger and more diverse cross-section of the community. RSF continues to hold quarterly online community gatherings that serve as a forum for staff members to provide RSF updates, borrowers to share the impact their work is making in the world, and investors to consider how they can continue to unlock capital for social entrepreneurs.
* The purchase of RSF Social Investment Fund’s securities is subject to risks, which are described in our Prospectus, available here or by contacting us at 415.561.3900. This is not an offer to sell, nor a solicitation of an offer to buy, securities. Such offering is made solely by the Prospectus, and only in states where authorized. Past performance is no guarantee of future results. These securities are not FDIC or SIPC insured and are not a bank deposit.
About RSF Social Finance
RSF Social Finance offers innovative opportunities to invest, give, and get funding that generates positive social, economic, and environmental impact. Since 1984, RSF has made over $1 billion in loans and grants supporting diverse social enterprises in the areas of food and agriculture, education and the arts, and climate and the environment. Find out more about how RSF connects social entrepreneurs with diverse forms of capital. Follow @RSFSocFinance.
Christine O’Connor, Thinkshift Communications
mobile – 203-927-1753
RSF Social Finance
P.O. Box 2007
San Francisco, CA 94126
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