NewB is a “new bank” based in Belgium that managed to collect €35 million in 6 weeks, in order to be granted the precious banking license by the European Central Bank (ECB).
What is NewB?
NewB is a Belgian cooperative working to build an ethical and sustainable bank caring for human rights and mother earth. NewB intends to add value to the Belgian society as a bank by investing in the local economy and sustainable projects. NewB wants to change the way finance is done and perceived. To do that, it relies on 13 morals:
- Integration: NewB works with organisations and cooperators – they’re both owner and customers.
- Simplicity: NewB’s offers are clear and easily understandable.
- Safety: NewB invests in real economy, doesn’t take risks. Profit is not the ultimate goal.
- Sustainability: NewB cares for the planet and its people, therefore it shall exclude activities or projects that could harm society as a whole.
- Transparency: everything NewB does is public knowledge and is explained when needed.
- Innovation: NewB is working to create new products and solutions that would preserve social economy as well as the planet.
- Involvement: cooperators are asked to actively participate in the Bank’s decisions.
- Honesty: profits will be equally divided between deposits and the cooperative capital. Interests have an upper limit, preventing profits on NewB’s shares sale.
- Inclusion: NewB wants to offer universal financial service, meaning access to relevant credit for everyone.
- Seriousness: NewB doesn’t spend crazy amounts. This can be witnessed in the way NewB’s employees are paid: the highest salary can’t exceed five times the lowest salary.
- Diversity: NewB has a deep interest in getting everyone on board and pays attention to social and cultural differences.
- Closeness: one of NewB’s goal is to be close to the people. That’s why events with (future) members are held all across the – not so big – country, where people’s voices can be heard. It follows the rule one person-one vote.
- Professionalism: they work with people that know what they’re doing, with the client as the only interest.
That sounds like a dream, doesn’t it?
What did NewB achieve?
On the 25th October 2019, NewB announced that the Financial Services and Markets Authority (FSMA), approved the cooperative’s prospectus. This meant that NewB could start fundraising to raise the co-op capital. The challenge was the following: NewB needed to collect 30 million euros by the 27th November. You’ve read correctly, 33 days to raise €30 million. And if it failed, the whole project would sink. The €30 million limit was imposed by the European Central Bank (ECB) to grant NewB a banking license. The amount was calculated by the National Bank of Belgium (BNB), to ensure NewB would have a “safe-mattress” to start as a bank in the hostile milieu that is finance.
Despite national celebrities promoting the co-op, two weeks before the deadline “only” €3,5 million was gathered, thanks to more or less 4,000 new cooperators. NewB’s CEO, Bernard Bayot, explained that, at that point, the co-op was waiting on large contributions from public institutions, hoping this would bring the goal closer. By the 27th November: the aim was reached! The co-op managed to collect €30 million thanks to around 55,000 contributors, whose average age is 29. Universities, regional governments, public and civil companies, individuals – they all played a part in this race. Surfing on the phenomena that was becoming the co-op, NewB decided to extend its fundraising for one week and to try and reach €35 million. On the 4th December, 71,162 investors had taken part in this six weeks fundraising and the upper limit of €35 million was raised.
How did NewB get there?
The project began in 2011 when 24 civil organisations decided to do something after witnessing the 2009 Belgian banking crisis that led to the disappearance of small and public banks. On the 6th of May, the cooperative NewB was newly born.
About 43,000 citizens had joined the project by 2013. One year later, NewB wondered: what kind of investments do I want to do in the future? The question was posed to the members and thanks to a high rate of participation, discussion led to a decision on what path to follow. By June, cooperators – mainly people like you and me – agreed on a series of products that would keep the project growing. While Belgians started to be more and more familiar with the concept, NewB launched its first bank card in 2016. The prepaid “GoodPay” card is the first sustainable bank card in the country – not to say in the world. At that point, about 100 other civil organisations decided to come on board.
Then came 2017, which was a pivotal year on several levels for NewB. New CEO, new GoodPay card, new insurance projects, new website and new design (in short, a New Bank?). From there, NewB became the largest social movement in Belgium and worked hard to get the precious banking license.
What’s next for NewB?
The BNB has to read the 3,000-page folder submitted by NewB to explain the project and its viability. Afterwards, it will write to the ECB to develop its assessment of NewB’s situation and its recommendations. Eventually, the ECB will make a decision before the 15th of March. Even though NewB’s CEO seems confident, he is aware that nothing is finalised yet.
Therefore, this incredible and powerful story is to be continued…
Photo by NewB
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