The Equal Exchange Certificate of Deposit
A Three-year CD with a competitive APY
Managed by Eastern Bank
Buying an Equal Exchange Certificate of Deposit (CD) – rather than a conventional CD – means your money goes to support Equal Exchange, Fair Trade, and our small farmer partners across the world. The great news is your savings can earn competitive interest rates and support your values.
Equal Exchange has grown each year since we were founded in 1986. Our sales are now over $50 million a year, and our purchases benefit thousands of small farmers and their families. But buying ever more coffee, tea and chocolate each year requires financing. Many of our supporters have asked how they can help, and this is our answer.
Here's how it works: the minimum purchase is just $500, there's no maximum, and the term is 3 years. The CD program is managed by Eastern Bank, an organization which has been serving Massachusetts consumers and businesses for nearly 200 years. All the money from the CDs is pooled together and made available to Equal Exchange as a low cost loan. Your CDs guarantee that loan. That means that there is a higher risk than with a normal CD; if we default on the loan it's possible to lose some of the principal. See What Risks am I Taking?
In return for that risk, your money can be used for tremendous good. For example $2000 can buy, at Fair Trade prices, the complete coffee harvest of a typical family farm. That 5-acre farm, perhaps high in a remote Peruvian valley, might support 6-8 people. So with a $2000 CD you can help keep a family on their land, providing hope that they can improve life for their children. You earn a competitive interest rate, too.
You probably have a few questions; we hope the links below will provide some answers. If you have more questions please don't hesitate to call or email Dan Fireside at email@example.com or 774-776-7423.
- I love it, how do I apply?
- What is the rate?
- How is the CD different from regular CD?
- What risks am I taking?
- Tell me about Equal Exchange's financial performance?
- Who can buy this CD?
- Can I buy one for my IRA? (No, sorry)
- Why just a 3 year term?
- Tell me more about Eastern Bank?
- Sounds interesting, but I still have some questions.
How do I Apply?
The Equal Exchange CD application is handled by Eastern Bank. The application for the Equal Exchange CD differs from other CD applications, as you will need to sign a loan guarantee.
Please carefully review the questions and answers on this page, then call Sotheary Fennell at 617-897-1035, or email her at firstname.lastname@example.org. Sotheary will explain the application process and help answer questions about the Equal Exchange CD program.
What is the rate?
Eastern Bank offers this CD at its most competitive 3-year CD rate. For details, visit the Equal Exchange CD page on the Eastern Bank website.
How is the CD different from a regular CD?
It differs in two related ways:
First, the money you invest in this CD is available to Equal Exchange to fund their growth in Fair Trade (rather than condos in Miami or whatever your conventional CD might fund today).
Second, we do this by having your CD guarantee a loan to Equal Exchange, which means that if Equal Exchange does not repay the loan for some reason – perhaps we go bankrupt – then you may lose some or even all of the money. See below What Risks am I Taking?
So compared to a conventional CD, you are taking some additional risk of loss, and reaping some additional benefit by directing your money to advancing social justice. The interest rate and other terms are the same as you’d expect with a conventional CD.
What Risks am I Taking?
Unlike most regular CDs, you could lose money with the Equal Exchange CD.
Your Equal Exchange CD is used to guarantee a loan. If Equal Exchange were to become bankrupt or unable to pay its debts, then you risk losing some or all of your money. If for example, the company did not pay back 20% of the loan then you could lose up to 20% of your CD.
We understand that this might make you a little concerned. Your money is at risk, so you'll want to know Equal Exchange will be prudent with it. To that end you should read the next section about Equal Exchange's past financial performance. In addition, Eastern Bank is FDIC insured, so if the bank closes, FDIC insurance will cover Eastern Bank depositor accounts, dollar-for-dollar, including principal and any accrued interest through the date of the bank's closing, up to the insurance limit.
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Tell me about Equal Exchange's Financial Performance?
Equal Exchange has been in business since 1986. We turned our first profit three years later, and with the exception of a small loss in 1998, we have been profitable every year since. We are a worker-owned co-operative and the largest 100% Fair Trade company in the United States. You can read our audited financials and all of our annual reports online.
We have never defaulted on a loan, and each worker-owner makes a personal investment in the company. If we make a profit they get a share, if we make a loss it comes out of their pockets. Perhaps that is one reason we’ve been successful.
Finally if the company is ever sold, all the proceeds are distributed to other Fair Trade organizations. We're not in business to make anyone rich, not us, not you. We're in business to offer a fair deal to all and use the power of commerce to change the world for the better. We’d love to have you join us.
Who can buy this CD?
Any U.S. resident or U.S. organization. It could make an excellent gift for grandchildren, or a good way for a church or synagogue to further support their social justice goals. Please tell your friends if you think they might be interested.
Can I buy one for my IRA?
In short, no. The CD is a guarantee for a loan, which means it is not eligible for purchase for an IRA. Sorry.
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Why just a 3 year term?
We chose three years because it represents the reality in the field for a farmer. If they know they can count on selling their harvest at a Fair Trade price for a few years they to can start to plan for the future; sending a child to school, improving quality, or diversify their crops.
Of course you can also renew the CD at the end of the term and continue to fund Fair Trade for another three years.
Tell me more about Eastern Bank?
Founded in 1818 and based in Boston, Eastern Bank is the largest independent and mutually owned bank in New England, with over $7.0 billion in assets and more than 90 branches throughout eastern Massachusetts.
And through the Eastern Bank Charitable Foundation, Eastern Bank supports issue of concern to our communities, such as affordable housing, health care and human services.
To learn more about Eastern Bank, and its Charitable Foundation, visit www.easternbank.com.
Sounds Interesting, but I still have some Questions
No problem, just email Dan Fireside at email@example.com or give him a call at 774-776-7423.
Okay I'm ready to apply …
Great, call Sotheary Fennell at 617-897-1035, or email her at firstname.lastname@example.org. Sotheary will explain the application process and help answer questions about the Equal Exchange CD program.
On behalf of small farmers on four continents, thanks, and welcome aboard!
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