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Lending in Native American communities
Economic development activities take place in communities of every size and description, from the largest cities to the smallest rural towns. No matter where development takes place or what population it affects, it depends on funding for its support. In many cases, lending is the primary vehicle for delivery of development funds.
In this issue of Community Dividend, we focus on aspects of lending, with a special emphasis on lending in Native American communities. As in other communities, reservation-based business owners often face barriers to obtaining start-up or expansion financing. To counter this problem, some Indian Country communities have established community development loan funds.
The Lakota Fund, the focus of our cover story, is a perfect example. Established 14 years ago in response to depressed economic conditions on the Pine Ridge Indian Reservation, the Lakota Fund is now an instrumental part of the community's development infrastructure. Our story discusses the lessons learned from the fund's lending activities and the accompanying photos depict some of the fund's success stories.
The discussion continues in "A Conversation with . . .," featuring Lakota Fund Executive Director Elsie Meeks. In our interview, Meeks explains the challenges faced by small businesses in Indian Country and offers advice to help lending institutions become involved with Indian Country loan funds.
Expanding on the theme of Indian Country lending, a feature in this issue revisits 1999's "Walking the Native Path: Seeking Solutions Through Economic Development and Housing Opportunities" conference, cosponsored by Community Affairs. The article discusses the feedback received from attendees and reports on development activities that grew from the information provided in conference sessions.
A special feature in this issue explores lending from the consumer's point of view. The article explains how loan-pricing models are used to determine interest rates for commercial lending. An awareness of these models can help consumers understand how their credit histories affect the lending process.
Finally, we round out the issue with a feature on a special happening in Community Affairs: a July tour of St. Paul's developing Phalen Corridor area, arranged for Federal Reserve System Governor Edward Gramlich.
We hope the information presented in this Community Dividend will enhance your understanding of community development.
