Alon Gelcer is the kind of person who likes to put his money where his mouth is.

The 43-year-old paramedic from Nelson, B.C., is more likely to spend his vacation time volunteering at an orphanage in Mexico — which he and his family did over the Christmas break — than stay in some four-star resort, for example. “Time and money are the common currencies of power in our society,” he says. “And I’ve always felt power should be used in a positive way.”

That desire to use his money to do good has always had an impact on Mr. Gelcer’s investment portfolio. Until recently, being a socially responsible investor in Canada essentially meant buying ethical mutual funds, which are generally tied to the stock market and, as such, prone to risks many people prefer to avoid.

Canadian investors generally haven’t had access to safe investments that generate modest returns and contain an ethical component, all while protecting their money from market downturns.

But that may be about to change. For the first time in this country, Citizens Bank of Canada is offering something called a Shared World Term Deposit.

The deposits function a lot like a guaranteed investment certificate in that they are 100-per-cent guaranteed (a one-year term deposit, for example, currently draws a return of 3.7 per cent) and they are RRSP-eligible. But unlike conventional GICs, where the investor has little control of what happens to his or her investment, the Citizens Bank notes also have an ethical component: The money is used exclusively to fund microfinance lending throughout the developing world.

The product first went on sale to the public in December and the first round of invested capital is now being disbursed to such ventures as fair-trade coffee co-operatives, and independent media organizations in countries with totalitarian regimes.

Mr. Gelcer was one of the first to sign up for the notes. He has always eschewed conventional banks in favour of credit unions, and he was already a Citizens Bank member when the bank staff told him about the new product it was about to offer. “My guiding ethics are compassion and integrity,” he says. “So when I heard about the product, I thought, ‘Well, that’s perfect.’.”

Founded on the principles of MohammadÖ Yunus, winner of last year’s Nobel Peace Prize for his pioneering work in loan programs in Bangladesh, microfinance is the term that describes making small loans to people in the developing world who are routinely overlooked by traditional financial institutions because they lack collateral.

The borrowers use their micro loans, which they pay back with interest, to build small businesses and stimulate their local economies, and improve their own lives.

“We’re very excited to be able to offer this product to our members,” says Elisabeth Geller, community and environment programs manager for the Vancouver-based Citizens Bank.

“The bank was founded 10 years ago with the expectation that we’d one day be able to offer a product like this. That day is finally here, as this product is unique in a number of ways.”

The Shared World notes are the most direct way Canadian investors have to contribute in microfinance on a global level, and that aspect appealed to Mr. Gelcer.

Citizens Bank pools the money raised from the sale of the Shared World term deposits and purchases a secure note from the U.S.-based Calvert Foundation, which is devoted to ethical investing and has offered a similar product to Americans for more than a decade.

“Calvert acts as a broker for us,” Ms. Geller explained. “Under normal circumstances, we would go out and do the due diligence [on the borrowers] ourselves but it’s quite a bit harder to do that internationally ..... So instead of paying people to fly all over the world and do that, we use the Calvert people who have already been there for years.”

About 45 per cent of the funds go directly to microfinance lenders in various countries in Asia, Latin America and Europe; 40 per cent goes to international non-governmental organizations, which help build the infrastructure to support microfinance lending where it doesn’t exist; and about 15 per cent goes directly to borrowers themselves. “Our funds are divided among 19 different microfinance groups across the globe,” said the Calvert Foundation’s executive director, Shari Berenbach.

“A lot of people assume that microfinance is a new concept, and that the world’s just discovering it now, but we actually have a proven track record of doing this,” Ms. Berenbach added.

In fact, Calvert has offered a variety of ethical mutual funds and GIC-like notes for the better part of a decade to American investors. But for Canadians, it is a novel concept.

“It’s one thing if we, as a financial institution, wanted to get involved in international microfinance,” Ms. Geller explained. “We would make a grant to this agency or that agency to lend money to women in Nicaragua. We can do that. But we, as a bank, are saying, ‘Let’s take this one step further and give our members that opportunity.’ It’s not just our profits — it’s their investments, their money.”

And while the socially responsible component appeals to ethical investors such as Mr. Gelcer, that’s not the only appeal. It’s also 100 per cent safe — something that appeals to other types of investors as well.

Maurice Pratt, a 58-year-old computer consultant from Calgary, was also among the first to sign up for the deposit. “We were looking at getting a GIC,” said Mr. Pratt, whose 56-year-old wife, Polly, works for the Alberta Cancer Board. “While we were talking to the people at the bank they told us about the [Shared World] product. The guaranteed return was what we were looking for, but helping somebody was an added bonus — the fact that my money isn’t just going to some hole somewhere.”

The Pratts never considered themselves to be ethical investors.

“Until a few weeks ago, I’d never even heard of microfinance, so I can’t say we were waiting our whole life for something like this to come along,” Mr. Pratt said.

“But we’d look for it now,” his wife added.