In our first episode, Stephen Muers and Antonis Schwarz discuss how dormant assets can be leveraged to finance impact. Dormant assets are, for example, bank accounts which haven't been touched for many years and for which the owner cannot be found. In the UK, dormant assets have been used for over a decade to fund social impact investment. Stephen is the CEO of Big Society Capital, the financial institution through which these funds are channeled to investments that generate both a financial and a social return (e.g. social housing). Antonis is a philanthropist and impact investor who has long advocated to use dormant assets to finance impact in Germany. We discuss, amongst others, what political momentum there is for this in Germany in the aftermath of the elections.
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Key takeaways
- In the United Kingdom, legislation has been in place for over 10 years to channel assets in dormant accounts to social investments. Big Society Capital, a financial institution created for this purpose, uses it to finance social housing or social enterprises that promote financial inclusion, for example. Big Society Capital has received inflows of £425 million from dormant accounts, but has been able to leverage this sum many times over by mobilizing additional investors.
- In Germany, an estimated €2 billion of assets are in dormant accounts.
- The use of dormant accounts for the common good is taken up in the coalition agreement of the German government (p. 30 „Wir werden die rechtlichen Rahmenbedingungen schaffen, um Guthaben auf verwaisten Konten zur Förderung des Gemeinwohls nutzen zu können“).
About Financing Impact
Financing Impact is a podcast about funding and scaling societal impact. This podcast is brought to you by SciFi, the Societal Impact Financing Initiative at ESMT Berlin. SciFi is supported by the Bill & Melinda Gates Foundation, among others.
For feedback on the show or to suggest guests for future episodes, contact us at scifi@esmt.org
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