Impact Guarantee: Building the infrastructure for inclusive capital
August 4, 2026
New Power Labs' Allison Gibson sat down with Julia Grady (Executive Director & Co-Founder, 10C and Co-Lead of the Impact Guarantee) and Eric In (Founder of Mapleric Impact Positif & Senior Advisor, New Power Labs) for a wide-ranging conversation about a new piece of financial infrastructure years in the making: a pooled loan guarantee designed to protect Canada's community lenders and unlock capital for the entrepreneurs and organizations they serve.
The conversation highlighted that community lenders already know how to assess risk in their own communities. What has been missing is the infrastructure to back that risk so capital can move at scale, and that infrastructure is now close to launch.
1. The Impact Guarantee pools risk so no single lender or guarantor carries it alone.
Social finance intermediaries (SFIs), including community lenders, across Canada are financing arts and culture, food security, mental health, poverty prevention, workforce inclusion, affordable housing, climate solutions, and lending directed to Indigenous and other underfunded organizations. Small and medium-sized SFIs reach borrowers who lack the collateral, credit history, or institutional track record that conventional risk models require.
With billions of dollars in private and philanthropic capital seeking meaningful impact, the SFIs are not underfunded due to scarce capital. They are underfunded because the financial infrastructure to connect that capital to community lenders has been incomplete.
The Impact Guarantee, Julia Grady outlines, closes that gap. It pools guarantees from foundations and other funders, meaning guarantors keep investing their capital as they normally would, while the guarantee itself adds social and environmental impact to those investments. Alongside the guarantee pool sits a first-loss fund, currently at $2.5 million with a goal of $7.5 to 10 million, the annual interest revenue from which absorbs the earliest losses before they reach guarantors. The program is launching with $20 to $ 25 million in guarantees in place, working toward a goal of $50 to $100 million across a portfolio of 15 to 20 community lenders, targeting a 2% annual loss rate.
The team’s goal is for the Impact Guarantee to grow the community lending funds it backs from roughly $70 million in assets under management to more than $500 million. This goal aligns directly with New Power Labs’ initiative, Fund Canada, which mobilizes asset owners and asset managers to direct $500 million to underfunded and overlooked leaders by 2030.
2. Building shared infrastructure took years of co-design with funders, community lenders, and the sector itself.
Julia traced the Impact Guarantee back to conversations she, Kristi Fairholm Mader of Thrive Impact Fund, and Tracey Robertson of the Ontario Trillium Foundation began through what they called the Catalytic Capital Lab, which convened six to eight funders and several social finance intermediaries to identify the sector's systemic gaps. The resulting guarantee structure came from co-designing with the community lenders it would serve.
That collaboration continues inside the program's structure. Julia described a peer-learning role built into the Impact Guarantee, in which community lenders, once vetted through due diligence, learn from each other's approaches to managing and mitigating losses, rather than each solving the same problems in isolation. Julia named a core set of principles guiding the work: shared governance, collective growth, shared learning and capacity building, a focus on underserved populations and communities, and equitable and affordable access, including protection for non-accredited and small investors.
Both Eric In and Julia were candid about the fact that the work has not been simple. It takes considerable legal work to resolve eligibility for a foundation's disbursement quota and to structure the guarantee to meet charitable activity requirements. Julia noted that community economic development is not, on its own, recognized as a charitable activity in Canada, a limitation the team had to design around rather than wait for policymakers to fix.
3. De-risking works both ways, and it is not about subsidizing bad lending.
Eric In explained that the guarantee addresses a gap between perceived risk and actual risk. Investors often assume community lenders will lose more than the lenders' own data supports, and that assumption drives up the cost of capital that community lenders pass on to borrowers. A guarantee changes what an investor is being asked to accept, which lowers the cost of capital and can be the difference between a project that gets financed and one that does not. Community lenders keep the flexibility to assess borrowers on their own terms rather than converging on the same collateral and credit history requirements that already exclude those borrowers from banks. This is not designed to subsidize unsustainable lending. The aim is to allow community lenders to continue operating on reasonable terms while remaining viable over the long term.
For guarantors, Eric argued the leverage is significant. A guarantor's expected loss is small with a targeted 2% annual loss rate, so a modest guarantee can support financing many times its size. Pooling guarantors across many lenders spreads that risk further and saves each guarantor the cost of setting up a separate agreement with every fund.
Julia added that a single commitment to the Impact Guarantee gives a foundation national reach across many types of community lending, rather than requiring a separate guarantee relationship with each fund, while still allowing the foundation's own capital to remain invested as it otherwise would.
4. The stakes go beyond any one guarantee, and that is the opportunity.
Both Eric and Grady assert that the Impact Guarantee is a crucial infrastructure for the social finance sector. Eric pointed to more than $140 billion sitting in Canadian foundations, much of it invested in public markets that generate no social return and, increasingly, are managed by firms retreating from commitments to diversity. Against that backdrop, a guarantee backed by a foundation's balance sheet, rather than a new disbursement, is one of the most efficient ways to direct capital toward a stronger, more sustainable social finance sector in Canada, delivering real impact in our local communities.
Julia and Eric also pointed to what could follow if the model succeeds. The Impact Guarantee does not directly address early-stage businesses and non-profits that need equity financing rather than debt. Venture capital and private equity, Eric said, mostly ignore this gap because the returns are not large enough to interest them. This contributes to the barriers that women-led businesses in sectors such as healthcare and « femtech » continue to face. Julia described a possible next step for the Impact Guarantee itself: once the program has a track record of real data from its first cohort of lenders, using that data to make the case for larger-scale investment into community lending as a whole.
5. The Impact Guarantee is close to its first contracts, and asset owners and asset managers have a role to play now.
Julia and Eric both pointed to the same near-term milestone: moving from design to the program's first signed agreements. Julia said a data room for foundations and investors is nearly ready, and the team is preparing to open intake for community lenders this Fall, with Eric leading the underwriting design process. The goal, Julia said, is to make that intake process thorough without making it inaccessible to the smaller funds it is meant to serve.
Foundations, family offices, and other funders interested in becoming guarantors, and community lenders interested in joining the pool can connect with Julia Grady or Kristi Fairholm Mader (reach out to us at team@newpowerlabs.org, and we can connect you). As Eric In put it, the tools and the evidence already exist. What has been missing is the collective will to put them to work at scale, and that is the gap the Impact Guarantee is now closing.Learn more at ImpactGuarantee.ca
What’s coming next
In the upcoming New Power Talks, we are bringing together influential experts who are working on collaborations and initiatives to accelerate the flow of capital to diverse leaders and communities in Canada. Keep an eye out!
The Capital Unlocked 2026 Summit is happening on November 5 in downtown Toronto. The summit convenes funders, investors, policymakers, and impact leaders from philanthropy, social finance, and investment to forge the partnerships, commitments, and practical next steps that will get resources flowing to underfunded leaders across Canada.
Expect dynamic panels, deep side conversations, interactive workshops, and abundant networking opportunities. Get notified for early bird tickets here.
