Barriers to Entry
As we approach the end of our first fiscal year in September, Sandhya and I can synthesize our learnings many ways, but one repetitive takeaway lately is a nuanced understanding of barriers to entry. Our experiences starting-up a nonprofit community lending organization, working with our partners and working with people taking on loans have shaped this understanding significantly over the past year. With this growing knowledge, we hope to continue building collectively to address barriers to entry and, ultimately, to ensure that we continue to prioritize people facing the highest barriers to accessing affordable credit in our financial system.
As a startup nonprofit in our first year, we have been confronted with many barriers to entry: navigating compliance, investment regulations, state regulations, federal regulations, legal services, accounting, insurance, payroll & HR, establishing effective governance, obtaining our 501c3 status, tax reporting, integrating end-to-end online loan management technology, fundraising, impact investment raising, recruiting and everything in between. All of these components to effective community lending have presented real lessons to us as we continue to iterate and evolve our approach.
Lately, we have been extremely grateful for transparent, open and honest feedback from our existing and prospective community partners as we seek to design by centering people in our approach collectively. This feedback has highlighted the desire to not just shift resources, but also shift power by decentralizing control and decision making as we seek to facilitate affordable community lending programs for people experiencing discrimination in the financial system (join us for a conversation on this).
Based on this feedback, we're working towards approaching this work less as a centralized community lender and more as a facilitator capable of removing barriers (and costs) to entry for affordable community lending programs at the discretion of our partners. By managing compliance, loan management, accounting, insurance, investment, and other operational aspects essential to effective community lending, we hope to facilitate affordable lending programs with input and design criteria led by our community partners and the people they are accountable to. Ultimately, we also hope to share the costs of these services, rather than duplicate costs unnecessarily across many community lending entities. Our hope is that this support will effectively reduce barriers and costs to entry for our partners and the communities they serve, but we are continuing to think critically about how to do this with an approach that is values aligned, does not extract from the people we seek to support, and does not unnecessarily burden our partners with costs they cannot afford.
Ultimately, we are constantly reminded of the real barriers to entry that we are working to overcome collectively - the barriers that people face on an ongoing basis in our financial system as they seek to access affordable financial products and services. While the operational barriers to entry in affordable community lending are high, the economic barriers for people in our community are much higher. Although it's increasingly difficult to remember this in a remote and online context with COVID, we strive to keep them and their goals in mind as we continue building in partnership with others.
With this in mind, we also strive to encourage open, honest and transparent feedback from our partners and network; this is essential to our ability to continue designing effectively in ways that center people. Please don't hold back if you have feedback to share about our work and how/where we can improve. Sandhya and I strive to not take this feedback personally as, while this work cannot be purely professional given how much any nonprofit or social sector employment entangles us and our individual identities, we aim to remember that this work is ultimately not about us. That doesn't mean we don't bring our own experiences, skills, ideas and perspectives to inform this work, nor does it mean that we aren't on our own learning journeys with steep ups and downs, but it does mean that we hope to continue recognizing the people who we are truly building for and designing to remove barriers in their economic pathways first and foremost.
We're looking forward to sharing more comprehensive updates about the past year soon - in the meantime, as always, please feel free to reach out to connect with us or explore opportunities for collaboration.
If you are a nonprofit or community organization interested in designing an affordable lending program, please contact: sandhya@communitycreditlab.org;
If you are funder or investor interested in supporting or capitalizing affordable lending programs, please contact: ryan@communitycreditlab.org;
If you are individual interested in supporting affordable lending programs in your community, please join us by subscribing on Patreon.