A local lending partnership you can copy

A local credit union partnered with community organizations to facilitate loans for small businesses with needs not met through traditional lending. Leslie Ackerman of Alternatives Federal Credit Union is using this model and presented on it at the BALLE Business Conference.

The community organization brings the mission and raises the money.
The local investors and community contribute the capital.
The local lending institution manages the lending program.
The funds are deposited as a loan loss (collateral on the loans).
The community organization sets the lending policies.
The local people can invest in local businesses at lower risk.
The businesses get access to loans they might not otherwise fit, and the repayment is reported to build their credit history.
The financial institution gets to support the community.
The loans are made at a relatively low rate.
The deposits can earn a small amount of interest for investors.

Local lending partnerships like this are profiled in Local Dollars, Local Sense: How to Shift Your Money from Wall Street to Main Street and Achieve Real Prosperity–A Community Resilience Guide Disclosure: this Amazon affiliate link benefits our contributor Jon Swanson’s not-for-profit projects.

New to SmallBizSurvival.com? Take the Guided Tour. Like what you see? Get our updates.

• About the Author
• Latest Posts

About Becky McCray

Becky started Small Biz Survival in 2006 to share rural business and community building stories and ideas with other small town business people. She and her husband have a small cattle ranch and are lifelong entrepreneurs. Becky is an international speaker on small business and rural topics.

• Best practices for rural housing - July 19, 2021
• How to be more open to new ideas #IdeaFriendly - July 3, 2021
• Market your small town as a movie filming location, attract movie and game fan tourists - June 28, 2021
• Survey of Rural Challenges 2021 results, analysis of themes from 2015 through today - June 7, 2021
• What makes a small town a micropolitan or nanopolitan? - May 22, 2021
• Improving Rural Housing: turning blighted dilapidated houses into new homes - May 7, 2021
• Are marijuana shops good or bad for small towns? - April 22, 2021
• Downtown is your town’s core: How to make your case - February 22, 2021
• Zoom Towns: attracting and supporting remote workers in rural small towns - December 10, 2020
• In an economic crisis, spend your brainpower before your dollars - November 25, 2020