Author's product rating: 
| Advantages: |
Provide finance for charities |
| Disadvantages: |
Low interest rate as it is donated to Charities |
| Recommend to potential buyers: |
yes |
The Charity Bank (www.charitybank.org) is a fantastic idea.
They provide finance at much lower rates than those commercially available to Charities. This is dependent upon the general public saving with them. You have a choice when saving with them of receiving no interest (hence reducing cost of borrowing to nil for charities) to receiving 2%. I opted for 2% so that I could ensure that my capital was protected against inflation.
Opening an account with them is easy, you can download a form off the net and complete it. Be ware of one thing, they want proof of ID which needs to be photocopied and certified as being a true likeness of you by a professional (Teacher/Doctor/Lawyer/Accountant) who is not a relative. You also need to provide proof of address Bank statement/utility bill).
There is a selection of personal accounts (for instance, the building assets account allows payments to be made by Direct Debit, the small steps account is ideal for children to start investing etc). There are also accounts for charities themselves to deposit cash or for corporates. Joint accounts can also be opened.
The minimum balance which needs to be held is £10, and any individual can open an account (if over 16). Statements will be sent out in 6 monthly intervals (April and October).
If you're worried about the security of your assets, the account is subject to Depositor Protection (organised by the Financial Services Authority) which guarantees 100% of all deposits below £2,000 and 90% of the next £33,000.
The benefits to charities are great. It allows them to opt for capital projects now, and not defer whilst waiting for fundraising. For instance, if you donate £50, it goes toward helping people. Great. However, deposit £1,000 and if you decide on 0% interest you may forgo £50 of interest. Well, in this case, the £50 has been used by the charity and the £1,000 can be used as a loan. A really great gift.
This is investment which is socially responsible. You don't have to invest a fortune, I have a few hundred in the account. But, every penny gained by the Charity Bank is passed on to charities. You won't even notice it's not there!!
For further information, go to www.charitybank.org
