NEF, the first French bank for solidarity and sustainable development
The New Fraternal Economy wants to give back to the circulation of money its human dimension
Ina Ranson, 1999
This sheet presents the NEF (Nouvelle Economie Fraternelle, a major player in SSE and solidarity finance).
The NEF (Nouvelle Economie Fraternelle) is both an association (under the French law of 1901) and a financial company (limited and cooperative). Created in 1979 by individuals and legal entities linked to organic farming, the cooperative movement and Waldorf schools, the association’s objective was to research and implement new forms of economic and financial mutual aid. The Financial Company was approved by the Bank of France at the end of 1988. Affiliated with the Caisse Centrale du Crédit Coopératif, it collects resources from individuals, institutions and companies wishing to put their savings at the service of individual initiatives of real social utility.
In December 1998, at an Extraordinary General Meeting, the Board of the Financial Company presented the project to transform the NEF into a fully-fledged bank within a year, i.e. during 1999.
Money management under the signs of reciprocity and interdependence
The NEF is not the only example of solidarity economy in a country with a rich tradition of social economy where mutualist, cooperative and associative activities are more developed than elsewhere. « But for the first time, » explains Marie-Thérèse Ducourau, in charge of reception at the Paris branch, « a banking institution recognized by the public authorities is working to establish transparency in the circulation of money, in order to raise awareness among borrowers, lenders and members, in the sense of an interdependence that can be called solidarity or fraternity.
The NEF collects deposits on term accounts (minimum 2 years immobilization) with a choice for the area of allocation of savings and the choice of interest (between 0 and 4%), as well as deposits on a NEF-BFCC passbook, with an interest of 2.5% (similar to the Caisses d’Épargne’s B passbook) and a solidarity check-account managed by the Crédit Coopératif. Savers can donate part or all of the interest they earn to the association’s solidarity fund.
In November 1998, NEF launched, in partnership with the organic stores and supermarkets « Biocoop ", France Nature Environnement and WWF-France, the Nature Savings Account which is used to finance « ecologically useful " projects: help for the installation of farmers who want to practice organic and biodynamic agriculture, creation of organic stores, development of renewable energies, creation of eco-industries, protection of the environment Subscribers to this savings account can transfer the totality of the interest received to one of the partner associations.
NEF attaches the utmost importance to the quality of its services. The reception of borrowers, the very thorough study of the files, the search for guarantees (essentially the guarantees of natural persons surrounding and supporting the initiative) require time and means that far exceed the activity of an ordinary bank. This activity is supported by membership fees, donations to its solidarity fund and by some subsidies.
Each year, NEF publishes a list of the loans it grants. Approximately 40% of the loans go to the creation of small businesses, notably by the unemployed or those on welfare; the other half is divided between organic agriculture, ecology, education, culture and health.
Examples of projects supported by the NEF
« The voice of employment " : Four former unemployed people, aged between 40 and 50, all former company managers, have formed a company to develop and manage a voice server designed to promote employment for young people. This computer system, developed within the framework of an agreement with the local missions, and with large companies, makes it possible to carry out an automatic comparison between the CV of a job seeker and the offers closest to his skills.
The Deffi Bois association, based in the Loire region, has been involved in local development for several years. By relying on the use of renewable and recyclable materials, it assists and accompanies project leaders. Every two years, Deffi Bois organizes a fair with the aim of reviving the wood trades in construction.
An educational farm: the Bourbonnaise Adater association aims to create an activity center linked to organic agriculture and with an educational and welcoming vocation. The NEF helps with the acquisition of land and equipment.
Key figures in September 1998
In September 1998, NEF’s capital reached 18.5 million Francs ; it was subscribed by 2800 members, mainly individuals and some foundations, institutions and companies.
Stable savings amount to about 38 million Francs, in 830 term accounts. Mobile savings amounted to 65 million francs in mobilizable resources from 1,300 passbook accounts and 1,000 « NEF-Credit Cooperative » checking accounts opened in Crédit Coopératif branches.
As for the use of resources: 750 loans representing 135 million francs have been granted since January 1, 1989. The current outstanding loans are 50 million. Short- and medium-term loans are generally guaranteed by surety rings, while long-term loans are guaranteed by mortgages.
In addition, the capital, currently at 18.5 million, is divided among 2800 members, individuals and legal entities (the capital share is 200 F). « To become what we aspire to be - the first bank for solidarity and sustainable development, we must gather 40 million in capital by the end of 1999 at the latest. It is not easy, but we hope to succeed », Blaise Desbordes says confidently.
The « ethical and ecological » investment is in full development in many European countries. In addition to investment and credit activities, some banking institutions are also pursuing a mission of information to the public trying to promote a new awareness of responsibility concerning the effect of money in our society. In addition, ordinary banks can also take initiatives to help finance innovative projects that serve sustainable development. In Austria, for example, regional banks are doing great service in promoting renewable energy.
To go further
Vif-Argent, Newsletter of the members of La Nef, Fall 1998