“He has refrained from oppressing the poor; he has not exacted advance or accrued interest; he has obeyed My rules and followed My laws—he shall not die for the iniquity of his father, but shall live.” Ezekiel 18:17 (The Israel Bible™)
Good news for small businesses, first-time homebuyers and non-profit organizations: They will soon be able to access fixed low-interest loans from Ogen – Social Loan Fund, which is currently in the advanced stages of becoming Israel’s first not-for-profit social bank. Ogen is the first of 2,500 organizations to receive an expanded Credit Provider License license from the Ministry of Finance’s Capital Markets Authority.
Ogen – Social Loan Fund is a public benefit company wholly owned by its parent charity, Ogen – Free Loan Fund. Since its inception in 1990, the non-profit organization has lent a total of ILS 1.2 billion in interest-free loans to 62,500 Israeli households and small businesses. Ogen – Social Loan Fund will receive an equity boost of ILS 50 million from Ogen – Free Loan Fund. The establishment of Ogen – Social Loan Fund will significantly increase the Ogen Group’s capital base, which today stands at almost ILS 300 million.
The Ogen Group is currently comprised of four not—for-profit organizations, all with the shared goal of creating financial empowerment and providing accessible and affordable credit for disadvantaged people, small businesses and non-profit organizations in Israel. Ogen was established in order to achieve a new level of fairness and equality in Israel’s financial sector and to encourage upward social mobility.
Ogen – Social Loan Fund is a Public Benefit Company (PBC) funded by impact investors from Israel and around the world. In its initial phase, The Social Loan Fund will offer low-interest credit to small businesses, disadvantaged families and non-profit organizations. Later, once Ogen is licensed by the Bank of Israel, The Social Loan Fund will become Israel’s first not-for-profit social bank. The board of Ogen – Social Loan Fund is comprised of leaders in Israel’s banking, business and philanthropic sectors who volunteer their time and skills, including Adv. Ofir Ozeri, Adv. Dalia Tal, Linda Benshoshan, Daniel Recanati, Boaz Raam, Tal Shlasky, and Aviad Friedman.
Sagi Balasha, CEO of the Ogen Group: “Receiving our license from the Capital Markets Authority is an important milestone. I am pleased that Ogen is the first to receive the expanded license in its new format, which required the submission of numerous documents, meticulous planning, and a methodical business strategy.”
Ofir Ozeri, Chairman of the Ogen Group: “The underlying motto that guides Ogen’s credit activity is providing “life changing loans”. This conveys our commitment to making a positive change in people’s lives and for Israeli society in general. The sole profit that motivates us is the positive impact we’re able to make. because we care and our only profit is our borrowers’ personal and social gain.”
The Bible explicitly forbids charging interest on loans, referring to it as נשך (neshech) which literally means “a bite”. The Biblical commentaries compare it to the bite of a snake which begins in one small spot but gradually kills the entire man. The Book of Ezekiel classifies the charging of interest among the worst sins, denouncing it as an abomination and metaphorically portraying usurers as people who have shed the borrower’s blood. Interest-free loans were considered a high form of charity.
Ogen’s small business loans extend up to ILS 200,000 with a 5% fixed interest rate, secured by one guarantor. Ogen requires borrowers to present a professional business plan prepared by a business advisor.
Loans for families purchasing their first home are available up to 100,000 ILS, at a 5% fixed interest. These loans are intended to help families pay a down payment on apartments of up to ILS 1.5 million in value. These loans are primarily given to families who have completed Ogen’s free “Ogen La’Bayit” coaching program, which helps disadvantaged families improve their finances and join the housing market.
Ogen also provides low-interest bridge loans for non-profit organizations and public benefit companies that provide services for the government, designed to help borrowers organizations experiencing cashflow challenges while waiting for government funding to arrive.
Ogen – Free Loan Fund provides interest-free loans to underprivileged families facing large expenses that could threaten their financial stability.