|
 |
Last update : March 2005 (figures)
Citizen’s Bank aims to help entrepreneurs in Japan through teaching them how to do Life-Value Business and guaranteeing loans. It offers collateral-free loans to people who cannot arrange credit from commercial banks because they do not meet the criteria for borrowing. Financing is done by the partner bank and Citizens bank guarantees half of the borrowed sum.
Background
The Citizen's Bank started its service in 1989 under co-operation
between Press Alternative (PA) and Eitai Credit Union in downtown of Tokyo.
Thanks to a similar co-operation with Shokusan Bank in Yamagata Prefecture in 1994, and
with a commercial bank through Oosaka-Fu in 1995, and with Ikeda Bank in Itami city, the
Citizen's Bank was able to spread its service to other areas.
In 1996, 31 credit unions joined the Citizen's Bank in Tokyo area.
Structure
Citizen Bank is a concept of a bank for citizens, that is, a registered trade name. A company or firm does not exist under that name as such. In practice, a contract will be concluded between WWB Japan and an established commercial bank, whose specific lending programme will then carry the name of Citizen Bank. The partner bank is in charge of the financing to the target entrepreneurs, and WWB Japan provides training and guarantees the loan.
Activities
In autumn 2001, Citizen's Bank has started activities in three
prefectures, namely Yamaguchi, Fukuoka and Hiroshima prefectures.
The co-operating bank is Saikyou Bank which have more than 30 branches all over these
areas.
In 1998, they also started to educate college students to become student entrepreneurs.
They already helped more than 10 student entrepreneurs.
Now in Japan, after the collapse of the bubble economy, financial
institutions had a managerial crisis which aggravated the situation, and in 1995 three
credit unions in Tokyo went bankrupt one after the other.
Credit Unions are now at a turning point. During the bubble economy period, credit unions
followed major banks and actively lent money to real estate aiming at increasing their
profit and expanding their business.
Now that the bubble economy has collapsed, they try to acquire a new positive profile as
credit unions.
There are several characteristics which differ the Citizen's Bank form conventional loan services.
The primary objective of the Citizen's Bank is to nourish socially meaningful businesses. They consider the social value of the business.
The Citizen's Bank does not require any security for loan. It has always been very difficult in Japan to access credit to start a social business and moreover if the entrepreneur was a woman. Especially when the entrepreneurs had no guarantee. Thanks to Citizen's Bank, this is now possible. Citizen's Bank provides loans and not grants.
Citizen's Bank carefully assesses the new business and request a business plan. The project must be sustainable and profitable. If the entrepreneur doesn't know how to prepare a business plan, Citizen's Bank help her until she is able to prepare the necessary documents herself.
That means that Citizen's Bank also provides training and education.Applicants have to attend the WWB/Japan Business School managed by WWB Japan. They can then acquire the necessary knowledge in accounting and managing.
Once the business has started, Citizen's Bank also provide follow up support.Once the loan has been agreed, Citizen's Bank assist its customers. This can be by helping the entrepreneur during its business official opening or advertising its business in their monthly information magazine "Citizen's Bank & WWB/Japan News" or introducing them to mass media...
They give continued attention and care to their customers and maintain face-to-face relationship in order to establish mutual trust and confidence.
Normally, social business such as welfare services cannot easily be profitable and this should be taken in charge by the State - public services. However, public sector alone cannot fully provide these services and up to now such a vacancy was filled by volunteers. To ensure continuity, new businesses appeared to offer truly needed services at fair prices. By supporting those businesses we would like to change the consciousness of financial institutions as well as lenders.
New Developments Planned
Citizen works with International community banks and local governments, discussing how to succeed in community development and community banking.
Key Figures
| 2002 | 2003 | |
| Number of loans | 105 | 117 |
| Total outstanding loans | Eur 4 408 732 |
Eur 4 256 414 |
