Social finance is not a new idea.

You are likely already familiar with micro-finance (small loans) and community development finance (loans specifically directed to projects that support low-income communities to be more prosperous).

Canada's Cooperative Sector

Over 150 years old in Canada, the cooperative sector has demonstrated the value of community-based finance. In Ontario alone, there are over 150 credit unions with just under 650 branches owned by more than 1.2 million members. The total loan volume of the member credit unions of Credit Union Central of Ontario alone exceeds $3 billion.

Québec's Social Economy

The social economy is part of Quebec's DNA. Just a few examples of Quebec social finance programs include:

• La Fiducie du Chantier l’économie sociale was established in 2007 as Quebec’s first patient capital quasi-equity fund, and has so far invested $15.7 million in 53 projects. The debentures are offered with a 15-year term.
• Réseau d’investissement social du Québec (RISQ) is a funding program supported by the investments of many financial institutions and companies, plus the provincial government. RISQ extends loans and loan guarantees to organizations that participate in the social economy. A special budget line has been earmarked for social enterprise start-ups.
• Fonds de Solidarité FTQ is known as one of the most important sources of risk capital in Canada. Worth $8.3 billion in assets, it also invests in La Fiducie du Chantier l’économie sociale.
• SOLIDES was established as a response to the need for local micro loans. $73.8 million was invested in 2009.
• Le fonds de développement emploi-Montréal is a community-based development fund that extends loans ranging from $25,000 to $100,000 to initiatives that create economic vibrancy in Montreal. $5.8 million was invested between 2009 and 2010.
• Investissement Québec is a public fund that provides financing to social enterprises specifically.

"Economic activity can be considered as part of the social economy to the extent that it follows certain principles: 1) the purpose of an initiative must be of service to members or to the community; 2) management must be autonomous; 3) the decision-making process must be democratic; 4) the redistribution of revenue and surplus must prioritize people and work; 5) individuals and the community must participate and take on responsibility." – from The Social Economy in Quebec by Marguerite Mendell.