In its strategy document, Reaching Further, Lloyds Bank says it will fund at least 700 charities at any one time over the next five years, funding more charities for up to six years, and focusing on those making significant impact for people and their local area. The size of its main grants will also increase, up to £200,000 over six years, and it will fund more flexibly, with fewer restrictions on when and how charities spend their grants.
It also plans to provide a wide range of developmental support, including training, consultancy and mentoring alongside its funding, and to champion the work of small and local charities nationally, locally, and regionally.
Alongside the launch of its new strategy, Lloyds Bank Foundation also released new research on the impact of smaller and local charities.
The Value of Small was commissioned by Lloyds Bank Foundation and conducted by the Centre for Regional Economic and Social Research (CRESR) at Sheffield Hallam University; the Institute for Voluntary Action Research (IVAR) and the Centre for Voluntary Sector Leadership at the Open University.
It found that when tackling social issues like homelessness, domestic abuse or mental health issues, smaller charities have a distinctive impact. They also generate benefits through spending and investing more in local areas, with the research highlighting one charity that generated £3.25 in value through volunteers per pound of funding, and others generating as much as three times more in additional funding than their public funding.
However, it also highlights a mismatch between what smaller charities do and the people they help, and how public bodies fund, commission and contract services and measure value, favouring larger providers. As a result, it states, 84% of local government funding is going to larger charities.