JAK Members Bank

The JAK Members Bank, or JAK Medlemsbank, is a cooperative, member-owned financial institution based in SkövdeSweden, and based on a concept that arose in Denmark in 1931.

JAK is an acronym for Jord Arbete Kapital in Swedish or Land Labour Capital, the factors of production in classical economics

JAK Bank Report Part 1/4 - Ethics

Vídeo de YouTube

A report about Swedish interest-free bank JAK, shot in Germany and Sweden, August 2007.

The Basics

A membership of approximately 39,000 (as of December 2015) dictates the Bank's policies and direction. The Board of Directors is elected annually by members, who are each allowed only one share in the bank. JAK Members Bank does not charge or pay interest on its loans, a principle it shares with Islamic banking. All of the bank's activities occur outside of the capital market as its loans are financed solely by member savings. Administrative and developmental costs are paid for by membership and loan fees.

JAK banking employs the "Saving Points" system: members accumulate Saving Points during saving periods and use them when applying for a loan. The concept is that one is allowed to take out a loan for oneself to the same extent as one allows other people to be granted loans, saving into one's account. For this reason (applying for a loan), earned Saving Points must be equal to spent Saving Points to ensure sustainability. If a member is borrowing more saving points than they currently possess, they are obliged to continue accumulating "aftersavings" during the repayment period. Aftersavings are a fixed quota of money that a member must save after one's loan was made, so they can continue to earn Saving Points. This way, at the end of the repayment period, Saving Points earned will be equal to Saving Points spent, and at that time they will be able to have back all their aftersavings.

JAK also offers a couple of loans where you do not need any saving points.

JAK Values

Interest according to JAK

JAK Medlemsbank promotes a society without interest. JAK Medlemsbank is interest-free, since the member’s doesn´t take interest from each other. 
We are against that one can make money only from having money. Like other banks JAK have costs for administration, which includes surplus to guarantee long-term sustainability and coverage of credit losses. Charges are being adjusted to the principle of prime cost so that it doesn´t cause redistribution of funds and profit is not given to owners.
According to conventional meaning interest means the expectation of continuous revenue from capital or the charge of loan that is being charged by the lender. This means a redistribution of resources from those who have little to those who have plenty.
We consider interest as being all payments of loans (borrowing and lending) that exceeds the actual and reasonable costs that the lender will have administrating this. Thus we make a distinction between what is paid as interest and what is paid as a cost or a charge of the loan.

Within JAK Members Bank we air our values openly. All economic rules are based on the values of the people. Therefore, it is important that we talk about our underlying values before we make decisions and consider economic actions.

At the annual meeting of the association, the members of JAK Members Bank have agreed upon the values, which form the basis for the activities within our bank.
Extracts from JAK’s ideological program, adopted at the meeting of the association in 2002:

We believe that:
  • People shall meet as free and equal individuals. We believe in diversity and cooperation. The ethical considerations are more important than egoistic profit motives. 
  • Money shall work as an interest free means of exchange, and not be means for speculation.
  • The economy shall counteract inequalities between the rich and the poor.
  • The interest system is unfair since it redistributes money from those who have less to those who already have a lot.
  • The economic reality shall be subordinated the demands for ecological sustainability.
  • Support and economizing shall be organized in a way that does not jeopardize our ecosystems. JAK does therefore take a stance against the demand of continuous economic growth.
  • Interest free financing promotes long-term investments, which are a prerequisite for sustainable development.
  • A just economy requires a democracy where everyone’s opinions and views can be accounted for in the same way.
  • Everyone shall have access to the information that is needed in order to make informed decisions.
  • Debates and discussions with respect for each other’s differences shall be stimulated.
  • Sound local economies form the basis for a sound globalization.
  • Money shall be used locally, where the people are, and to support real needs.