Sumitomo Mitsui Trust to launch product for school donations
Japan's Sumitomo Mitsui Trust Bank plans to launch a financial product for wealthy clients, with all investment profits donated to public elementary and junior high schools.
Marking the first such product by a Japanese financial institution, the bank is hoping to attract clients eager to address local community issues, with the profits used to support hands-on learning programs and enhance information technology in schools.
The initiative is aimed at addressing Japan's weak culture of charitable giving and to encourage donations on a regular basis and not just at times of disaster, as economic and educational inequality continues to grow.
The bank plans to donate the returns to local governments twice a year, establishing a sustainable model for regular investments.
While the product guarantees the principal, ensuring no financial loss for investors, it does not offer them any personal monetary gain.
According to the Japan Fundraising Association, individual donations in Japan totaled 1.2 trillion yen in 2020, significantly lower than 34 trillion yen in the United States, irrespective of differences in cultural norms and taxation.
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