Self-Help Ventures Fund
Creates and protects economic opportunity by providing fair and responsible financial products in traditionally disinvested communities.
Self-Help is a family of nonprofit organizations with a mission to create and protect economic opportunity for all, especially people of color, women, rural residents and families and communities of lower wealth. Self-Help was founded in 1980 to provide technical assistance to laid-off North Carolina mill workers interested in starting worker-owned businesses. Quickly learning these businesses—which were typically led by people of color and women—could not access conventional financing to pursue their goals, Self-Help created a credit union and a nonprofit loan fund. Over the years, Self-Help has expanded its focus to help disadvantaged populations build wealth through home and small business ownership and access to responsible account services. It has also formed a public policy arm to fight predatory lending and advocate for the needs of underserved populations and develops real estate that provides accessible and affordable spaces that anchor communities.
Entrepreneurs of color often struggle to access affordable financing to help their businesses grow and thrive. Due to years of redlining and other forms of economic marginalization, businesses owned and/or led by people of color are often located in disinvested communities. These entrepreneurs may have lower net worth and poor or little credit history due to long-term institutional discrimination. Commercial loan underwriting hinges on property appraisals, personal guarantees, and credit scores. So, even in the absence of contemporary discrimination, these businesses would struggle to access financing.
For many years, minority-led financial institutions like Second Federal and Seaway served Chicago’s communities of color when conventional banks did not. Losing these and other local minority-owned institutions would create a vacuum in the supply of capital to these communities and businesses.
Through its acquisitions of Second Federal and Seaway, Self-Help was able to retain existing leadership to continue the work of these two important community institutions. Through SHVF, Self-Help is looking to expand its efforts and fill market gaps, offering more flexible commercial loan products than are standard through regulated credit unions.
SHVF will use the $5 million loan from the Benefit Chicago fund to support its commercial lending and real estate development efforts in the city, providing business loans to entrepreneurs of color and/or service providers over the next two years. Additionally, a portion of the loan will fund renovations to the Seaway Bank headquarters in the Chatham neighborhood. In addition to its banking activities, this location will offer space for multiple nonprofit and small business tenants that will contribute to the ongoing revitalization of the surrounding neighborhood, while providing employment opportunities and needed services for community residents.
More information about Self-Help Ventures Fund can be found at Self-HelpFCU.org.