Responsible Short-Term Lending
As the United States economy continues its slow course toward recovery, more consumers than ever are turning to alternative financial solutions to improve their economic conditions. These populations – the unbanked and underbanked – often live paycheck-to-paycheck, and rely on short-term solutions when their funds run out. Studies have shown that these consumers have few, if any, other options for credit access, making responsible short-term borrowing a necessity to pay their bills, feed their children, and get to their job(s).
These consumers range from young to old. They consist of students fresh out of college, who have not had the time to build a credit history and those looking to make ends meet while seeking jobs. With many millions facing the increased financial pressure of an uncertain job market, nearly half of young adult households fall into this unbanked and underbanked category and without other options, are increasingly reliant on alternative forms of finance.
Short term lenders – including those represented by NAFSA – help these consumers meet their basic financial obligations by providing credit when every other institution turns them away.
Tribal sovereignty will and must be protected at every opportunity, and tribal lending provides a key path to promoting a tribe’s right to make its own laws and be governed by them.
Sovereign nations benefit from increased economic development, and the opportunities provided by tribal lending promote sovereignty through increased independence and control over the tribe’s future and self-determination goals. A tribe’s ability to effectively exercise their sovereignty decreases their dependence on U.S. government and drives tribes to economic self-sufficiency. Instead of being economically dependent on the government and excluded from certain regulated businesses, tribal sovereignty allows Indian tribes to operate these businesses under their own enacted laws, rules and regulations.
With an increased number of Americans seeking alternative financial services, tribes nationwide have been stepping up to fill the need. This promotes economic development and self-sufficiency in Indian Country through increased employment and tribal investment for the benefit of tribal communities. As a result, NAFSA works with tribal officials to identify challenges to tribal sovereignty and support the protective efforts of individual tribes, which allow them to competitively participate in economic activities within the United States.