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In Sweden the JAK Bank practice since 1970 a system of savings and loan without interest. The banking license was obtained in 1997. Formally JAK is a cooperative bank. Currently it has 33 000 members and membership growth is 7% per year.

JAK MEMBERS BANK: SYSTEM AND SAVINGS LOANS WITHOUT INTEREST RATE

The loans are funded by member deposits JAK. Until 2006 all the members have saved the sum of € 87 million, and borrowed the sum of € 76 million (in 2006). The administration and development costs are covered by membership fees and annual fees loans (approximately 2.5% effective rate of interest).

Combined with the savings account without interest rates, we have two products - both are free interest rate:

1. The loan-savings balance (original) - more favorable for individuals.
2. The lending instrument and support offerings (new) - rather for associations and corporations.

WHY NO INTEREST?

We consider it legitimate to pay for work done or for taking risks, but not only make money with money. In our view it is immoral to give loans against interest rates where there is no work, no risk involved.

The use of interest also causes negative effects in society. They encumber the price of goods and services when producers add to the selling price to cover the interest costs of borrowing. In an economy based on interest, the money is transferred from those who have the least to those who are most, and this way the assets are concentrated in the hands of a few.

Finally, since our modern monetary system is based on debts and that virtually all money is in the form of debt that must be repaid with interest, we have a money system that is growing exponentially. Everything that grows exponentially will inevitably one day reach its breaking point. Today we have an exponential increase in both real assets in financial assets, including money.

For these reasons, the major goal of JAK is an economy without interest. To this end we offer:

• Banking system-based lending and savings interest rates without
• Support to the dialogue of the Community JAK.

COMMUNITY DIALOGUE JAK

A relationship with money involved is still a matter of trust. Knowledge of our idea "without interest" and our activities are spread more by word of mouth and between people and knowledge. For this reason our marketing is done on the basis of dialogue between members and others, on the economy and interest themes. We are organized to support all members in this dialogue.

The membership is constantly increasing. In 1991 we were 19 000 and currently (in 2007) we are 33 000. The increase in the last 12 months was 7%. There are 600 members who promote the JAK model more actively. Most part of small branches. These branches are not involved in our banking, only the information of our products. The majority of dialogue is part of civil society in terms of our banking and monetary systems.

Our magazine Grus & Guld (Gravel & Gold) supports the dialogue and seminars for all members. Active members receive financial support to branches and local operations. We do training on the principles JAK and we organize meetings to support the internal dialogue, very important for those wishing to spread the ideas JAK around them.

OBVIOUSLY WE HAVE A BANK!

We needed a bank and we wanted to use it according to our ethical standards. We did not want to be exploited. That's why we created our own bank.

WE WANT ANOTHER WORLD - EQUITABLE

JAK is an association that has an active part of the economic system of our society. Our bank is a practical example of a fair and equitable economy that shows that another world is possible. JAK is different because it is without interest.

Other banks earn on those who borrow them charging a fee. The interest payment is a large part of total costs for most people. Remember that you pay interest not only to the bank - the interests are also part of the price of the price you pay for goods and services.

Producers, transporters, wholesalers and retailers, all those who form the chain of production, pay all the interest. Of course they add it to their prices to cover their interests. Ultimately it is the consumer who pays most of the accumulated interest costs throughout the production chain. Up to half of the purchase price in a store may amount to cover interest rates. In the housing sector the amount of up to 70%.

WITHOUT A REAL BANK INTEREST RATE

Known simply as JAK, JAK Members Bank is the first bank in Sweden, perhaps the world, where members share the profits of a viable banking system without interest. Members themselves are responsible.

JAK was founded as an association of savings and loan cooperative in 1965 and was officially named bank in December 1997 by the Government of Sweden, on the recommendation of the Finance Authority controls the Swedish State.

Because JAK is officially recognized as a bank, savings members are covered by deposit guarantee of Swedish banking system. Official recognition confirms that JAK has the structure and management accredited and thus presents an interesting alternative and trustworthy compared to other banks. The most important function of JAK is to ensure savings and loans without interest to members.

NATIONAL COVERAGE, BUT ...

We accept deposits and loans we are in Swedish kronor, SEK. We make mortgage loans or personal guarantee, but the property of beneficiary must be Swedish. For this reason there are few foreigners among our members. There is a growing demand for information on the system and JAK we participate in international discussions on the banks without interest. We do not seek partners for international expansion of JAK, but we do what we can with our limited resources, to share our knowledge and experiences with others interested in similar systems in their countries.

The loan-savings balance (original)

This is the original product that we have practiced since 1970. It has been designed for people wanting to save and then borrow for themselves, their relatives or friends. All such loans must be balanced by the amount of savings.

A loan amount, calculated monthly, must be balanced by the same amount of savings. These savings can be done before applying for the loan and the repayment period-savings. However there will be an agreement with the bank on the date of final repayment and savings. Sometimes it will take three months more than the final date in order to withdraw the amount saved.

An example: For a loan of SEK 100 000 for a period of 10 years, monthly payments will be SEK 1,775 (833 payment, the loan costs and savings deposits 108 833). If the borrower saves SEK 1,500 during the 48 months preceding the loan's monthly payments will decrease by SEK 1,532 (833 payment, cost savings and 108 590). Once the loan is repaid, the borrower may withdraw SEK 100 000 in the case of a pre-savings, and SEK 70 843 in the other.

The lending instrument and support offerings (new)

This is the new instrument that we introduced in 2001. It is designed for small companies and associations that provide reimbursement of costs and payments, but no more. Loans will be balanced by savings, such as loans, regular savings. The problem is solved if a player joins more to participate in savings.

When a loan is needed to finance a large project, there are usually participants who are preparing in advance and save. The first step will be to get ACCOUNT FOR SAVINGS in JAK. Then the supporting cast will open a SAVINGS ACCOUNT AND SUPPORT. It is these accounts that they will have their deposits as support for the project.

Those who support the projects will not necessarily members of JAK, and they are free to withdraw their money if they wish. The JAK nevertheless react if the Loan Fund Savings and decreases the level below the current loan amount, and ask the group of investors to raise the funds. If the fund does not completed, JAK require full repayment of the loan within a year.

A small company or association may request an account for obtaining support for his projects. The Bank will evaluate the nature of the request before granting such an account. The loan will be maximized to equal the amount deposited in the Savings Account and support underpinning the recipient of support.

LOCAL ECONOMY

The urbanization of society and overcrowded big cities is a problem without solutions. The financial sector is part of a global economic system that empties economically to rural areas to invest then in large cities and university towns.

By banks grow through mergers of commercial and rationalization, downsizing and liquidation of local agencies. The result is that access to financial services for small businesses decreases. Reducing access also means a reduced supply of loan capital. Access to risk capital has never existed for small businesses.

LOCAL - FOR ECONOMY FAIR AND EQUITABLE

Contact with members is maintained through representatives and local agencies. Activities in the local agencies are not part of the banking system. Here members help each other by making savings plans and loan. There is also information work being done by study groups and exhibitions.

There is also a Swedish magazine for members, which is called Grus & Guld (Gravel & Gold). There are reports on activities in the local agencies, and serves as a forum for open discussion and active between members and management of JAK. It contains in-depth articles on topics relating to personal finance and vision of JAK buoyant economy, fair and equitable for all. In addition there is the website www.jak.se

JAK supports a fair and equitable economy. This means a just economy that takes into account all environmental costs and manages to increase the prosperity of each long-term.

JAK is actively working to promote an economy that does not operate or people or nature. This is done through its lending programs and savings and informing on the bad effects of the interest on the money.

Address:
JAK MEMBERS BANK
Vasagatan 14 54150 SKÖVDE SWEDEN
Phone: +46 (0) 500 46 45 00 Fax +46 (0) 500 46 45 61
Email: jak@jak.se
http://www.jak.se

Note: this version in French is a shortened version for your information only. The text in Swedish is the official version and complete.

Wikipedia (English)

Source: RIBH, The Portal of Islamic Finance - Islamic Banks - Credit Immobilier - Halal Finance

This entry was posted Tuesday, March 17, 2009 at 17:59 in: Economy , Finance , Fraternity , Idea . You can follow any responses to this entry through the RSS 2.0 feed . You can make a comment or trackback from your own site.