Charitable Bonds are offered by Allia, a national charity that issues Bonds to raise money for social causes.
Of every £1,000 you invest in the Bond, around £800 is loaned at a commercial rate to a registered provider of social housing to develop affordable housing. The provider has a Aa3 rating from Moody’s. The remaining £200 or so after Allia’s costs is invested in social causes e.g. Microfinance which traditionally pays about a 2% return.
After 5 years, the housing provider repays the loan with interest and investors receive their money back in full. Moreover, investors can receive a return on their social cause investment too.