The Ogen Group, a nonprofit organization, said Monday it has raised $30 million to provide emergency loans and financial mentoring to small businesses, nonprofits and unemployed and furloughed workers to help them with much needed credit amid the economic crisis caused by the coronavirus pandemic.
The no-interest and low-interest loans, to be given out within seven business days, come as the pandemic has caused unemployment levels to surge to record highs and businesses to shut down due to the lockdowns imposed to counter the spread of the virus.
More than a million workers in Israel have registered as unemployed or on unpaid leave since the pandemic began, some 54 percent of whom are self-employed and ineligible for unemployment benefits. More than 20,000 small businesses have been refused government-backed loans, because they are deemed too risky, Ogen said in the statement.
The financial fallout has also pushed Israel’s nonprofit sector “to breaking point,” the statement said. Twenty-five percent of Israeli nonprofits, on which hundreds of thousands of Israelis depend for daily services in healthcare, welfare and education, have ceased operations entirely, Ogen said.
Ogen is also starting a campaign to raise an additional $70 million to meet the growing credit needs caused by the pandemic.
Formerly known as the Israel Free Loan Association (IFLA), Ogen was founded in the early 1990s by the late Prof. Eliezer Jaffe, an immigrant from the US. The nonprofit provides both interest-free and low-interest loans, as well as financial guidance, to people, small businesses and nonprofits in Israel that are ill-served by the financial sector, which sees them as too small and too risky to get financing.
The nonprofit has made more than 65,000 loans and lent more than $350 million since 1990. Ogen is also in the process of setting up Israel’s first digital, not-for-profit social bank in Israel.
During the pandemic, Ogen has already issued a first wave of emergency loans, distributing $2 million in interest-free personal loans, close to $3 million to small businesses, and more than $3.5 million to help nonprofit organizations.
Donors and impact lenders from Israel and abroad have contributed the additional $30 million that will go toward new loans, loan guarantees and financial coaching that they hope will be “life-changing,” the statement said.
Most of the new funds Ogen has received come from one anonymous Israeli donor who contributed $20 million in solidarity with those most affected by the financial downturn. Other philanthropists and organizations who contributed to the funds include Trudy and Bob Gottesman, the Russell Berrie Foundation, the Max & Marjorie Fisher Foundation, the Jewish Agency for Israel, The Max Barney Foundation from the UK, Jewish Communal Fund (JCF), PEF Israel Endowment Funds, the UJA Federation of New York, Migdal Group and Boaz Raam, and additional anonymous contributors, the statement said.