Israel Free Loan Association
Encyclopedia
The Israel Free Loan Association (IFLA) is the largest free loan association in the world, having lent out nearly $150 million in the last two decades. This non-profit organization
offers interest-free loans to citizens of Israel
only. It is supported primarily by private donations and grants. The IFLA's basic principle is that a loan is better than charity as it enables people to help themselves.
IFLA loans help immigrants from Ethiopia move out of temporary housing and buy apartments, enable university students to obtain academic degrees, allow ailing Israelis to undergo operations, help families with handicapped children to purchase medical equipment, help struggling Israelis get back on their financial feet, enable Israelis to start a business or expand existing ones thereby supporting both themselves and others and much more.
While with conventional charity the money is depleted, with free loans the source funds are preserved. And while with conventional charity its influence decreases over time, with free loans the influence increases as time passes as more and more loan repayments are recycled, from the same funds, ad infinitum. As the great Jewish sage Maimonides
wrote – a loan is better than charity as it helps people help themselves.
The IFLA is a non-profit organization and registered accordingly in Israel, the U.S., the U.K. and Canada. The Chairman of the IFLA is Jerusalem businessman Edward S. Cohen. The Founder and President of the IFLA is Prof.Eliezer Jaffe
, an expert on nonprofit associations and philanthropy, who is a Professor at the School of Social Work of the Hebrew University of Jerusalem
and Co-Chairman of the Center for the Study of Philanthropy.
The IFLA offers loans to new immigrants in Israel from any country ($4,166), to immigrants from Ethiopia
moving from caravans to permanent housing ($4,166), to parents raising a seriously handicapped child at home ($4,166-$8,333), to single parents or large families ($4,166), to adopting couples ($4,166-$7,000), to needy students for college tuition ($4,166), to immigrants and other struggling Israelis for small business loans (up to $19,444), to victims of terror or those with economic problems due to the security and war situation ($4,166) and to those in special emergency situations. There is no limitation on geographical location of the borrowers, so long as they are low income Israeli citizens living in Israel.
Applicants must be employed and earning at least an NIS 3,000 steady monthly income, and must have two to four guarantors who are employed. Loan repayments are flexible, but the basic principle is that loans must be repaid on schedule so that they can be constantly recycled and reissued to other borrowers. Only 0.29% of the loans made are defaulted.
From 1990 to 2011, the IFLA's capital had been recycled over three times the original value of donations and the source funds are recycled again in perpetuity.
Donors who make a $5,000 cumlative donation can create a Named Loan Fund to or in honor of family members or friends, or to mark an important occasion, or in their own name. Donors who have a Named Loan Fund receive an annual report of loans made from their loan account at the IFLA. Over 350 individuals, Jewish federations and foundations have chosen to open a named interest-free loan fund account in their name at the IFLA, which range from $5,000 to several million dollars. Others have included the IFLA in their will. The IFLA depends on these donations to meet requests for loans and to open new loan categories. There is a waiting list of applicants and donations are used immediately to issue new interest free loans.
In October 2011 Professor Jaffe was awarded the Speaker of the Knesset Prize for Outstand Personal Service to the State of Israel.
Non-profit organization
Nonprofit organization is neither a legal nor technical definition but generally refers to an organization that uses surplus revenues to achieve its goals, rather than distributing them as profit or dividends...
offers interest-free loans to citizens of Israel
Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
only. It is supported primarily by private donations and grants. The IFLA's basic principle is that a loan is better than charity as it enables people to help themselves.
General information
The Israel Free Loan Association is the largest interest free loan organization in the world. Since its inception in 1990 it has lent out nearly $150 million to over 43,200 low income families, the working poor and struggling small businesses. Currently it lends out $15 million every year to Israelis of all backgrounds.IFLA loans help immigrants from Ethiopia move out of temporary housing and buy apartments, enable university students to obtain academic degrees, allow ailing Israelis to undergo operations, help families with handicapped children to purchase medical equipment, help struggling Israelis get back on their financial feet, enable Israelis to start a business or expand existing ones thereby supporting both themselves and others and much more.
While with conventional charity the money is depleted, with free loans the source funds are preserved. And while with conventional charity its influence decreases over time, with free loans the influence increases as time passes as more and more loan repayments are recycled, from the same funds, ad infinitum. As the great Jewish sage Maimonides
Maimonides
Moses ben-Maimon, called Maimonides and also known as Mūsā ibn Maymūn in Arabic, or Rambam , was a preeminent medieval Jewish philosopher and one of the greatest Torah scholars and physicians of the Middle Ages...
wrote – a loan is better than charity as it helps people help themselves.
The IFLA is a non-profit organization and registered accordingly in Israel, the U.S., the U.K. and Canada. The Chairman of the IFLA is Jerusalem businessman Edward S. Cohen. The Founder and President of the IFLA is Prof.Eliezer Jaffe
Eliezer Jaffe
Eliezer David Jaffe is an Israeli social work researcher and teacher and advocate of philanthropy and non-profit management. He is Professor Emeritus at The Hebrew University's Paul Baerwald School of Social Work and Social Welfare.-Biography:...
, an expert on nonprofit associations and philanthropy, who is a Professor at the School of Social Work of the Hebrew University of Jerusalem
Hebrew University of Jerusalem
The Hebrew University of Jerusalem ; ; abbreviated HUJI) is Israel's second-oldest university, after the Technion – Israel Institute of Technology. The Hebrew University has three campuses in Jerusalem and one in Rehovot. The world's largest Jewish studies library is located on its Edmond J...
and Co-Chairman of the Center for the Study of Philanthropy.
Loan Recipients
From 1990 to 2011, the Israel Free Loan Association has provided nearly $150 million in interest-free loans to more than 43,000 needy Israelis to help them through a temporary financial crisis. The IFLA approves an average of 230 new loans each month, including personal and small business loans.The IFLA offers loans to new immigrants in Israel from any country ($4,166), to immigrants from Ethiopia
Ethiopia
Ethiopia , officially known as the Federal Democratic Republic of Ethiopia, is a country located in the Horn of Africa. It is the second-most populous nation in Africa, with over 82 million inhabitants, and the tenth-largest by area, occupying 1,100,000 km2...
moving from caravans to permanent housing ($4,166), to parents raising a seriously handicapped child at home ($4,166-$8,333), to single parents or large families ($4,166), to adopting couples ($4,166-$7,000), to needy students for college tuition ($4,166), to immigrants and other struggling Israelis for small business loans (up to $19,444), to victims of terror or those with economic problems due to the security and war situation ($4,166) and to those in special emergency situations. There is no limitation on geographical location of the borrowers, so long as they are low income Israeli citizens living in Israel.
Applicants must be employed and earning at least an NIS 3,000 steady monthly income, and must have two to four guarantors who are employed. Loan repayments are flexible, but the basic principle is that loans must be repaid on schedule so that they can be constantly recycled and reissued to other borrowers. Only 0.29% of the loans made are defaulted.
From 1990 to 2011, the IFLA's capital had been recycled over three times the original value of donations and the source funds are recycled again in perpetuity.
Donors
The IFLA is supported by private donations, grants and legacies from individuals and private foundations in Israel and other countries around the world. Administrative expenses are less than 4% of total financial activity, which are for salaries, bank charges and legal fees. Administrative expenses are partially covered by occasional overhead grants from some donors. No funding has come from the Israeli government or the Jewish Agency.Donors who make a $5,000 cumlative donation can create a Named Loan Fund to or in honor of family members or friends, or to mark an important occasion, or in their own name. Donors who have a Named Loan Fund receive an annual report of loans made from their loan account at the IFLA. Over 350 individuals, Jewish federations and foundations have chosen to open a named interest-free loan fund account in their name at the IFLA, which range from $5,000 to several million dollars. Others have included the IFLA in their will. The IFLA depends on these donations to meet requests for loans and to open new loan categories. There is a waiting list of applicants and donations are used immediately to issue new interest free loans.
Awards and recognition
The Israel Free Loan Association is a highly regarded national association. It has received the President's Award for Outstanding Volunteer Organization, the Mayor of Jerusalem Citation for Nonprofit Activity, the Ministry of Immigrant Absorption award for help to new immigrants, and the Sderot Conference Award for contribution to Israeli society. The IFLA website www.freeloan.org.il is in both English and Hebrew, and the Hebrew site contains application forms for use of borrowers.In October 2011 Professor Jaffe was awarded the Speaker of the Knesset Prize for Outstand Personal Service to the State of Israel.