Online Interbank Funding Platform for social-impact projects

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The idea of an online Interbank Funding Platform (IFP) has emerged from the recent growing interest in social and ‘impact investment’ businesses, which find it hard to obtain funding but are socially very attractive. This has led to the emergence of alternatives to traditional funding, mainly promoted on the Internet, which seek to support such projects through donations, cash rewards or interest rates that are generally lower than those available on the market. At the same time, traditional banking has reached a historic turning point: its behaviour is now increasingly challenged on ethical grounds, and it needs to innovate in response to this. This paper proposes a new Interbank Funding Platform that will put banks in closer touch with Socially Responsible Investment (SRI) and so have a greater social impact by funding a larger number of projects.

The rise and development of Socially Responsible Investment (SRI)

Socially Responsible Investment has gradually developed out of classic financial theory. The first changes were the result of demands by various religious groups which, starting in the United States in 1920s, called for more ethics in investment, with prior selection of assets based on a number of criteria. It was against this background that the Pioneer Fund – usually considered the first ethically inspired investment fund – was established in Boston in 1928.

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