A new range of mortgages to encourage community-owned shops has been launched by Silsden-based Ecology Building Society to help tackle the lack of services in rural areas.

The loans are available to organisations belonging to or receiving advice from the Plunkett Foundation, which supports the development of community-owned shops in the UK as around 400 village shops close each year.

The Ecology will donate 25 per cent of the application fee for each mortgage completed to the Plunkett Foundation – enough to provide initial support to at least five fledgling community businesses.

The package is available to new or existing community shops on terms from ten to 30 years with tiered interest rates linked to the level of equity raised by the group.

Lower interest rates are available for community shops that can demonstrate three years’ successful trading.

Paul Ellis, Ecology chief executive, said: “Community shops make a vital contribution to building a more sustainable society, regenerating the local economy, increasing democratic control, reducing loneliness and saving car journeys.”