par Growth Partners Arizona
Growth Partners Arizona Backs Partner Organization's BIPOC Community Managed Backed with $100,000 Investment
0% Interest Microloans up to $10,000
TUCSON, AZ / ACCESSWIRE / August 28, 2023 / Growth Partners Arizona (GPAz), a Tucson-based Community Development Financial Institution (CDFI), announced a $100,000 investment in a local loan fund to support BIPOC (Black, Indigenous, People of Color) entrepreneurs in Southern Arizona. The investment in Community Investment Corporation's (CIC's) BIPOC Community Managed Loan Fund will help at least 10 small businesses in Southern Arizona with no-interest microloans up to $10,000. The collaboration between Growth Partners Arizona and CIC marks a crucial step in the two-year old loan fund's progress with GPAz planning to expand the fund's community managed approach to the entire state of Arizona.
The BIPOC Community Managed Loan Fund is an example of character-based lending, an underwriting approach where a borrower's personal qualities, community reputation, and other factors beyond credit scores and collateral are given greater emphasis. A volunteer committee of BIPOC community leaders has all decision-making authority for the loan fund including defining the application process and what underwriting criteria is used to assess applications. In the loan product design phase, the committee identified specific obstacles to capital access for BIPOC communities which included distrust of the traditional financial institutions, overly complicated application processes, and banking's over-reliance on collateral and credit scores to make loan approval determinations. A low-barrier application allows business owners to apply via video or audio as well as in writing. Over the past two years the committee has approved over 50 no-interest microloans to BIPOC entrepreneurs in Southern Arizona totaling almost $400,000 in funding.
The application process utilizes a story-centered approach and limits arduous submission requirements. Unlike traditional loan applications, it is only after being approved for a loan that entrepreneurs are required to provide financial and business documentation. "I think some traditional lenders might be skeptical of our underwriting process," said CIC Executive Director Danny Knee, "but the performance of our loan portfolio shows that we are on to something with our trust-based approach."
The endorsement from Growth Partners Arizona, a prominent advocate for inclusive and sustainable economic growth, underscores the importance of creating accessible financial pathways for BIPOC entrepreneurs. The $100,000 investment not only reinforces the commitment of Growth Partners Arizona to equitable economic development but also emphasizes the power of collaboration in driving systems change.
CEO Andre Whittington from Growth Partners Arizona shared his enthusiasm about the partnership: "We are excited to partner with CIC in expanding the impact and reach of the BIPOC Community Loan Fund to communities across Arizona. Investing in the fund is not only important to the community but resonates with me personally. I have witnessed family members and friends lose their businesses due to limited or nonexistent funding opportunities. Through this partnership we are providing real solutions and establishing inclusive financial pathways for BIPOC business owners to secure the capital needed to scale their businesses."
The additional resources from Growth Partners Arizona will enable the BIPOC Community Managed Loan Fund to expand its outreach and support, nurturing even more BIPOC entrepreneurs in Southern Arizona. The fund's "revolving" loan structure ensures that repayments are reinvested, creating a self-sustaining cycle that empowers entrepreneurs and fuels economic growth within the community.
Knee expressed gratitude for the collaboration, hailing the infusion of $100,000 "as a testament to Growth Partners Arizona's shared commitment to fostering economic prosperity and addressing disparities in our capital access systems." As the BIPOC Community Managed Loan Fund continues to pave the way for a more inclusive and equitable business landscape, this partnership with Growth Partners Arizona reinforces the collective commitment to driving positive change and advancing economic empowerment in Southern Arizona.
For more information about the BIPOC Community Managed Loan Fund and its partnership with Growth Partners Arizona, please visit the program website, here.
About CIC: Community Investment Corporation (CIC) is a financial empowerment nonprofit. We give the members of our community, who are shut out of and left behind in our economy, access to the knowledge and financing they need to pursue new opportunities. CIC unlocks the door to prosperity for all members of our community to meaningfully participate in our powerful but imperfect capitalist economic system and reclaim the American Dream. At CIC, WE KNOW YOUR WORTH. The system may not recognize your value, but we do. Learn more about our loan, homeownership, and school bond compliance programs at CICTucson.org.
About Growth Partners Arizona: Growth Partners Arizona is an Arizona-based Community Development Financial Investments Fund CDFI that provides affordable, responsible financial products to local underserved communities. As a trusted intermediary between the public and private sectors, Growth Partner Arizona aims to achieve economic justice through forward- thinking, collaborative, and inclusive approaches to capital access in Arizona. We are committed to building a more inclusive economy that works for everyone. For more information visit: growthpartnersaz.org.
For more information:
Danny Knee, Executive Director, Community Investment Corporation, marketing@cictucson.org
SOURCE: Growth Partners Arizona
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