Preguntas Frecuentes

Investing and how it works

How does Shared Interest help people in the developing world?

A: Shared Interest Society pools the investments of its members and provides loans or credit services to over 400 fair trade businesses in 59 countries.

Are member investments at risk?

A: The money put into a Share Account is an investment. As with all investment products there is a risk attached. If we experienced substantial bad debts in one year, wiping out our reserves, we would have to suspend withdrawals or make a charge against Share Accounts. A member cannot lose more than they have invested and we have never made a charge against the value of Share Accounts since our commencement in 1990.

Is the investment protected by the Financial Compensation Scheme?

A: Although we follow all the Financial Conduct Authority procedures we are not covered by their Financial Compensation Scheme.  We are also the only accredited open share offer having received the Community Shares Standard in 2015.

Is there interest on an investment?

A: Our interest rate is currently 0%.


What type of organisation is Shared Interest?

A: Shared Interest Society is registered under the Co-operative and Community Benefit Societies Act 2014 and is a member of Co-operatives UK.

How many investors are there?

A: We have over 11,500 investors.


What is the loan criteria?

A: Producers must be registered with either Fairtrade International (FLO), World Fair Trade Organisation (WFTO), The British Association for Fair Trade Shops and Suppliers (BAFTS), Small Producer Seal (SPP) or the Fairtrade Federation. In addition, we require at least three years' trading history, a positive balance sheet and for there to be at least one export buyer in Europe, North America or Australasia. Buyers must be members of WFTO, Fair Trade Federation (North America only) or BAFTS (UK only). In addition, we require at least 3 years' trading history and a positive balance sheet.

Does Shared Interest charge producers interest on loans?

A: We normally lend on an unsecured basis as many of our customers either do not have any security to pledge, or have already used their assets to secure conventional borrowing. We do charge interest to our customers and this is based on the risk attached to the specific organisation and the risk of lending in a particular part of the world.  You can see more detail about these rates in our Social Accounts here.

Does the producer need to supply security?

A: No, Shared Interest does not typically ask for any kind of security against the facilities it provides.

How does an Export Credit facility work?

A: A Shared Interest Export Credit facility works by making funds available against particular orders - 80% of the order value for handcrafts and 60% of the order value for commodities. Funds can be drawn down to pre-finance an order and are then repaid when the buyer makes payment to the producer through Shared Interest on the order's completion; Shared Interest takes a portion of the buyer payment to cover the amount borrowed plus interest and forwards the balance on to the producer. When repayment has taken place, it frees up the funds within the credit limit so that they can be used against another order. An Export Credit facility can be used for many orders at the same time as long as the total amount borrowed does not exceed the credit limit.

What currencies does Shared Interest work with?

A: We will only lend in hard currencies (usually USD, GBP and EUR) as they are generally more stable and used for international trade, including fair trade.

In which countries does Shared Interest operate?

A: We have regional offices in Kenya, Ghana, Peru, and Costa Rica. We are not currently able to lend money directly to producers in India, Bangladesh, Pakistan or Nepal due to exchange control legislation, but we do make payments to fair trade producers across the region on behalf of our fair trade buyers.

Does Shared Interest lend to individuals?

A: As a general rule, we prefer to lend only to producer groups. We look at each application on its own merits and may lend to a private organisation where the fair trade principles are in place and we feel that the social benefit to the communities involved warrants our financial assistance. We do not work with private individuals.

Does Shared Interest offer training to producers?

A: Shared Interest Foundation, the charitable arm of Shared Interest Society does offer finance and governance training to producers. To learn more, please click here.

What is the difference between a producer and buyer customer?

A: Producer customers are organisations that we lend to directly.  Buyer customers are organisations who buy from the producer. This could be an importer or manufacturer like, CaféDirect, Liberation, Traidcraft or TWIN.  So the funds reach the producer directly but the debt remains with the buyer.


Is Shared Interest a microfinance organisation?

A: We are not a microfinance organisation and we do not lend to start-up enterprises or individuals. All of the businesses we work with need to be fair trade registered and show evidence of three years of trading, normally producing audited accounts.

Is Shared Interest a Credit Union?

A: No. However our investors do become members of Shared Interest.  The main difference is that the people we lend to are not from the local community.

Can an investor select which producer they would like to support with their investment?

A: Unfortunately, the way we operate means that all the funds are pooled together. This allows us to help far more individuals.  As loans are repaid, we are able to lend the money out again. Last year each £1 invested was lent 1.8 times and we helped 362,000 individuals.

Does Shared Interest help with the Fairtrade certification process?

A: No.  We do not have the capacity to check that the producer is following all the certification criteria.  

What is the definition of FLO-Certified?

A: In order for a company to put a Fairtrade label on their packaging they must have bought the ingredients/product from a Fairtrade Labelling Organisation (FLO) certified producer.  This is issued by Fairtrade International.  They have their own independent auditing arm called FLO-Cert who check that the producer is following the Fairtrade principles.

What is a bad debt charge?

A: At the end of the year we look at the list of debts and decide how much we feel is not fully recoverable. This sum is set aside as cost in our annual accounts so that the overall result for the year reflects any anticipated losses.  It could be that this money is eventually written off but we try to work with the customer to allow them to pay down the debt over a longer period. Sometimes, with special reasons, this might even involve us lending more to the customer so that they can continue to trade.  When we make a loan/facility we always assess the risk and add a premium to the cost of money to reflect this.  


What is the difference between the Foundation and Society?

A: They are two separate legal entities. The Society relies on the capital invested by its members in the form of withdrawable share capital. The Foundation, a registered charity, relies on donations which, can be gift aided. They also receive money from Comic Relief and other grants. In terms of what they do, the Society lends money and the Foundation undertakes training and building of support organisations.