An American Indian and Alaska Native financial sovereignty moment is gaining ground, revolutionizing capital access for Native families. The Oweesta Corporation, a national Native community development financial institution (CDFI) intermediary, is forging a path to financial sovereignty. Led by Native CDFIs, the Native financial sovereignty movement acknowledges that nothing will change for Native communities without Native families having access to homeownership and Native small businesses having access to capital.
The Native financial sovereignty movement now has 70 certified Native CDFI and the number grows in momentum, scale, and size each day. These Native CDFIs represent diverse Native nations ranging from Hawaii to Maine, and yet they remain deeply connected and more similar in model than disparate. These community-driven financial institutions help their borrowers navigate the bureaucratic systems steeped in inequities that continue to sideline — and redline — Native communities.
Native CDFIs are fighting to change exclusionary financial practices every day. Relying on community-driven lending products and deeply accountable to their communities, Native CDFIs operate under a relationship-based lending model. Despite longstanding misconceptions about the risk of lending in Indian County, Native CDFIs often hold lower write off and delinquency rates than conventional banking institutions.
In 2020, Oweesta’s Native CDFI partners deployed more than $71 million, most in the communities underserved by all the federal relief programs such as the Paycheck Protection Program (PPP). Even in the throes of the pandemic, the average Native CDFI write-off rate for Oweesta’s borrowers was one percent and their delinquency ratio (more than 90 days late) was just 3.9 percent. In short, they found that Native families and small businesses that borrow from Native CDFIs meet their payment obligations far more often than not.
Native CDFIs regularly credit the strength of these lending programs to the in-depth technical assistance and training they provide. Despite the high cost of these services in a world focused on financial efficiency, Native CDFIs persistently invest in one-on-one relationships with their borrowers, providing high-touch counseling and support services. For example, earlier this year Oweesta became a U.S. Department of Housing and Urban Development housing counseling intermediary serving the Native Homeownership Network, a network of Native CDFIs and nonprofits.
In addition to working to serve those excluded by the financial mainstream, Oweesta’s Native CDFIs are also working to attract traditional lenders to also help finance projects in their communities. For example, Native CDFIs have been working with the federal Bureau of Indian Affairs for years to help streamline the leasehold mortgage process, the process under which land titles are recorded on tribal trust lands. The changes that accompany these efforts are slow but are building momentum over time. The result has been a veritable revolution in capital access for many Native families and small businesses.