LONDON, England - Research carried out for the London Rebuilding Society suggests that traditional financial institutions are failing voluntary, charity and community groups, leaving the social enterprise sector overly dependent on inadequate sources of grant funding.

A consultation exercise carried out with some of the 30,000 social enterprises registered in London shows that mainstream financial institutions do not understand the special needs of such groups, leading them to offer potential clients inappropriate products and services.

In an attempt to find a creative solution to the shortage of funds for businesses with a social purpose, the London Rebuilding Society is launching Investing in London, an ethical share issue designed to raise £500,000 (in the first year, and £5m over five) to be channelled into enterprises working in the poorest parts of London.

Potential investors are invited to make a minimum investment of £250 in shares in the London Rebuilding Society, which is working to improve Londoners' quality of life by providing finance and business support to hundreds of social enterprises, voluntary organisations and community groups. The funds raised will be invested in enterprises throughout the capital, and investors will become members of London Rebuilding Society, which is developing a range of innovative new investment funds for organisations which trade for community benefit rather than private profit.

Ed Mayo, chair of London Rebuilding Society and executive director of the New Economics Foundation said: "We are building a sustainable model of renewal in areas where government money compensates people for being poor, but does not help them to build wealth and we are doing it by giving Londoners the opportunity to invest in their own communities."

London Rebuilding Society chief executive Naomi Kingsley commented: "A great deal of activity is taking place among London's poorest communities aimed at improving standards of living and providing new jobs and opportunities. Often potentially vibrant and profitable businesses which could make a real difference to communities cannot access the funds they need and so cannot grow. Investing in London is a means of generating funds for poor but enterprising communities and encouraging them to invest in themselves."

Anyone interested in finding out more should visit: www.investinginlondon.com

London Rebuilding Society

London Rebuilding Society

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