Best Funding Sources for Community Projects in 2026

Finding money is one of the biggest challenges for community groups. The good news is that a wide range of community project funding exists, from large national programmes to small local pots. The harder part is knowing which sources suit your project, and presenting a case that stands out.

This listicle describes the main categories of funding available to community projects in the UK. Programmes open, close and change their rules often, and we do not quote amounts, deadlines or eligibility details that could be out of date. Always check each funder’s current guidance before you apply.

1. National Lottery Funders

What they offer. Distributors of National Lottery money support a wide range of community activity across the UK, with different programmes for community projects, heritage, sport and arts. Funding is usually organised by nation and theme.

Best for. Projects with clear community benefit and strong participant involvement.

Things to know
– Programmes have defined priorities and eligibility criteria.
– Applications can be competitive and need good evidence of need and outcomes.
– Monitoring and reporting requirements apply.

2. Charitable Trusts and Foundations

What they offer. Independent trusts give grants according to their own priorities, which might be a geographic area, a cause, a type of beneficiary or a specific approach.

Best for. Projects that match a trust’s stated interests precisely.

Things to know
– Many trusts have small teams, so read their guidelines carefully and follow them exactly.
– Some accept applications only at certain times or by invitation.
– Building a relationship, where welcomed, can help.
– Directories and funding databases can help you identify matches. Some are subscription-based; local infrastructure bodies often provide free access.

3. Community Foundations

What they offer. Community foundations manage local funds, often from donors and legacies, and distribute grants within a geographic area. Many also administer funds on behalf of other organisations.

Best for. Small, locally rooted projects.

Things to know
– Local knowledge matters, and applications often benefit from showing local support.
– Grant sizes are usually modest, but the process is often proportionate.

4. Local Authority and Public Sector Funding

What they offer. Councils and other public bodies may offer small grants, community chest funds, ward budgets or commissioning opportunities. Health bodies and police and crime commissioners sometimes fund relevant community work.

Best for. Projects that deliver local priorities, such as health, safety, employment or neighbourhood improvement.

Things to know
– Priorities change with political and budget cycles.
– Commissioning involves contracts and tighter requirements than grants.
– Partnership bids may be viewed favourably. Our guide to partnership models outlines options for collaborating.

Community Partnership Models: A Practical Overview

5. Government Programmes and Regeneration Funds

What they offer. Central and devolved governments have run funds aimed at levelling up, regeneration, community ownership and local growth. These programmes change frequently and may be administered through councils or combined authorities.

Best for. Larger capital or place-based projects.

Things to know
– Rules and availability vary widely, and schemes sometimes close or are replaced.
– Applications are often complex, so partnership working and professional support can help.
– Check the official government websites for current programmes.

6. Corporate Giving and Sponsorship

What they offer. Businesses give through donations, employee fundraising, volunteering, in-kind support or sponsorship. Some run community funds, often connected to their local operations.

Best for. Projects with local visibility or a link to a company’s activity.

Things to know
– Think about what the business gets, such as recognition, team engagement or alignment with its values.
– Check that the partner’s reputation and values fit yours.
– In-kind help, such as space, skills or equipment, can be just as valuable as cash.

7. Supermarket and Retailer Community Schemes

What they offer. Some retailers run local giving schemes, with customers or colleagues choosing which projects to support.

Best for. Small grants for local groups with an easy-to-explain project.

Things to know
– These schemes can involve public voting, so you need to campaign locally.
– Terms and availability differ by retailer and area.

8. Crowdfunding

What it offers. Online platforms let you raise money from many supporters. Some are donation-based, some reward-based, and some focus on community shares or investment.

Best for. Projects with strong public appeal and a supporter base.

Things to know
– Success depends on preparation and promotion. Plan your audience before launch.
– Platforms usually take fees.
– Match-funding from a funder or business can boost results.
– Be transparent about how money will be spent, and keep supporters updated.

9. Community Shares and Social Investment

What they offer. Some community enterprises, such as local shops, pubs or energy projects, raise money by selling shares or taking social investment.

Best for. Projects that generate income and have a clear business plan.

Things to know
– This involves legal and financial regulation, so take specialist advice.
– Investors expect transparency about risk and return.

10. Earned Income and Local Fundraising

What it offers. Events, memberships, small donations, trading and room hire all create unrestricted income that gives you flexibility.

Best for. Building resilience alongside grants.

Things to know
– Fundraising must comply with relevant rules, such as licensing for raffles or collections.
– Unrestricted income can cover costs funders often will not.

Quick Comparison

Source	Typical scale	Speed	Competition	Best fit
Lottery funders	Varies	Slower	High	Larger, well-evidenced projects
Trusts and foundations	Varies	Moderate	Moderate to high	Specific causes
Community foundations	Usually smaller	Moderate	Moderate	Local projects
Councils and public bodies	Varies	Varies	Varies	Local priorities
Corporate	Varies	Fast to slow	Varies	Visible local projects
Crowdfunding	Varies	Fast once launched	Self-driven	Popular causes
Earned income	Grows slowly	Ongoing	None	Resilience

How to Strengthen Any Application

1. Read the guidance twice. Check eligibility before spending time on the form.
2. Show the need. Use local evidence and the voices of residents. Avoid unsupported statistics; cite sources or leave figures out.
3. Explain outcomes. Describe what will change and how you will know. Our guide on measuring community impact can help.
4. Present a realistic budget. Include all costs, including overheads where allowed.
5. Show governance. Funders want to know that money will be managed well.
6. Demonstrate partnership and community support. Letters of support, volunteers and contributions carry weight.
7. Plan for sustainability. Say what happens when the grant ends.
8. Ask for feedback if you are unsuccessful, and re-apply when appropriate.

How to Measure the Impact of a Community Project

Mix Your Funding

Relying on a single source is risky. A blend of grants, local income and in-kind support protects against a single funder’s decision. Keep a simple funding calendar listing deadlines, decision dates and reporting duties.

Frequently Asked Questions

Where should a new community group start?

Begin with local sources, such as your community foundation, council small grants and local business support, then build experience for larger applications.

Do we need to be a registered charity?

Not always. Some funders support constituted community groups, CICs or other organisations. Check each funder’s eligibility.

Can we apply to more than one funder for the same project?

Usually yes, but be open about it. Many funders want to know what other support you have applied for.

How long does it take to receive funding?

It varies from a few weeks to many months. Plan ahead and avoid depending on a decision date.

Conclusion

The best funding sources for community projects are the ones that match your aims, scale and capacity. Combine local grants, trusts, public sector support, business involvement and your own fundraising. Read each funder’s current guidance, make a clear evidence-based case, and think early about how you will show results and sustain the work after the grant ends.