Those who wish to have a foundation or a social enterprise have a harder time having access to bank loans or credits to carry out their missions. But for these cases there are alternative finances that help those who want to make a change in their region.

There is no doubt that the world is full of crises, whether economic, social, environmental or political. The good thing is that it seems that the more problems appear, the more activists and hopeful initiatives that seek to change this reality and improve the community where they live.

However, when they ask for financial aid they are left behind, even marginalized by banking institutions.

What are alternative finance? How do they work? 1

Here come the alternative finance …

In this way we could understand Alternative Finances as that social participation that seeks to financially help those social initiatives, taking as a priority those agents that were separated from the conventional banking system. Its purpose is to collaborate in economic and sustainable development through solidarity and ethics.

The alternative financing movement is not born as a homogenous movement, but as a heterogeneous movement where small, socially relevant projects of close reach are being financed.
-Economy Solidarity Org

The forerunners of alternative finance have a vision that banks are more interested in the profitability of entrepreneurship than in the benefit it brings to society, that is why they rely on ethical banking that cares about the social impact of entrepreneurs or leaders of the foundations.

The Ethical Banking

The ethical bank is that financial institution that has a filter of positive criteria to invest in companies. For example, ethical banking would never collaborate with a company that practices child exploitation, but would do so with a business that promotes inclusion in their jobs.

Negative criteria may include environmental impact, generation of weapons, manufacture of drugs and alcohol, labor exploitation among others; while positive criteria can observe social inclusion, respect for biodiversity, transparency and attachment to human rights.

What are alternative finance? How do they work? 2

Some examples

The first networks of alternative financing and ethical banking were created in the seventies. It could be said that the Pax World Fund was born in 1971 with the premise that financial success could be achieved without the need to invest in armaments. Later, countries such as Canada, Australia and several European countries joined, such as France, Poland and Italy.

In Latin America it is more recent and there is still a long way to go to consolidate an institution of this type. However, our crowdfunding platform is a good portal to obtain financing for social and ethical companies.

What are alternative finance? How do they work? 3

Solidarity can come in many forms, from a credit to a donation. Any is valid. If you, who are reading, need to finance your social initiative, do not hesitate to have our platform. It sure is very helpful.

We recommend you read: How crowdfunding has driven the development of India

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Alternative finance seeks to improve the world