Unlocking More Impact Through a National Social Finance Guarantee
At Fair Finance Fund, transparency and innovation are at the core of how we work to strengthen Ontario’s food and farm sector. Today, we’re excited to share news of an initiative that could transform the future of social finance in Canada — and we’re asking for your support to help make it happen.
The Social Finance Impact Guarantee Working Group has developed a proposal for a national loan guarantee program designed to unlock more capital for impact-driven organizations and reduce risk for intermediaries like the Fair Finance Fund. The proposal, presented to MP Ryan Turnbull earlier this month, calls for $250 million in federal loan guarantees and a $10 million first-loss fund.
Across Canada, social finance intermediaries (SFIs) like Fair Finance Fund are financing solutions in affordable housing, Indigenous infrastructure, local food systems, climate resilience, and small business growth. Despite a strong pipeline of investable opportunities, too many SFIs are forced to turn away promising projects due to the real and perceived risks that deter capital from flowing into the sector. The Impact Guarantee directly tackles this barrier by pooling risk across multiple intermediaries and guarantors. By leveraging commitments from government, foundations, and private sector partners, the model is expected to unlock 20 times more investment into underserved entrepreneurs, regions, and sectors. It complements the federal Social Finance Fund by ensuring that catalytic capital can flow more confidently and quickly.
What does this mean for us? If implemented, Fair Finance Fund could participate in the program and access a first-loss guarantee on our loan portfolio. In practice, this would serve as a kind of insurance — covering a portion of any losses in the event of loan defaults. For our investors, it would mean even greater confidence in our financial security. For our loan clients, it would mean more capital available to fund their growth. And for our food system, it would mean a stronger, more resilient network of small and mid-scale farms and food enterprises.
As our Executive Director, Justin Abbiss, puts it:
“This initiative could be truly transformative for the sector, unlocking sector-changing capital by instilling confidence in investors and protecting their investments. With the right guarantee mechanisms in place, social finance intermediaries could raise significantly more capital, and in turn, dramatically increase their impact in the communities and sectors they serve.”
We believe this initiative is a potential game-changer for social finance in Canada. But to move forward, it needs broad sector support. That’s where you come in. The working group is collecting signatures on a letter of support to demonstrate to the federal government the strength and urgency of this proposal.
We encourage you to add your name — as an individual or on behalf of your organization — to show that you support a thriving, resilient social finance ecosystem in Canada.
Together, we can make capital more accessible, reduce risk, and unlock new opportunities for community-led impact.
