NatWest — the bank formerly known as RBS — has announced the expansion of its ringfenced social rent loan fund from £500 million to £1 billion to accelerate the delivery of homes for social rent across the UK.

NatWest said the first to market loan has no arrangement fee and discounted interest margins to support housing associations which are already NatWest customers.

This £1 billion loan offering is part of the bank’s ambition to lend £7.5 billion to the social housing sector to year-end 2026.

NatWest said the discount in fees and margin on the £1 billion when fully deployed could save the housing association sector up to £50 million of finance costs.

“The investment follows significant demand from housing associations and demonstrates the bank’s continued £7.5bn ambition to supporting the urgent need for affordable housing for 1.3 million people on social housing waiting lists,” said NatWest.

“Eligible housing associations which are existing customers of the bank can apply for the social rent loans which are incentivised with discounted interest margins plus no arrangement fee.

“The aim of providing discounted loans for building social rent homes will not only support their construction but also enable housing associations to allocate funds towards improving living conditions within the communities they serve.

“The government has pledged to stop children growing up in B&Bs as part of its child poverty strategy. In England alone, more than 172,000 children are living in temporary accommodation.”

NatWest Group CEO Paul Thwaite said: “Investing in safe, warm, and affordable housing for families isn’t just about shelter but an important investment in the long-term well-being, education, and economic prospects of children and their parents.

“With more than 1.3 million households still on social housing waiting lists in England alone, NatWest is committed to the role we can play in supporting the UK social housing sector in any way possible.”

“This is why we have pledged to increase our social loan offering to £1bn for our customers to help them build vitally needed social rental properties across the UK as part of our £7.5 billion lending ambition to the social housing sector.”