A group of Black business owners in Albuquerque have come together to make a different type of financial institution. The One Hope Financial Institution, which officially launched Jan. 31 at an African American Chamber of Commerce networking event, is aiming to make financial services more accessible to business owners of color.
In a press release, cofounder and Board Chair Ken Carson said systemic racism and a historical lack of access to capital has left businesses underfunded.
Besides providing technical assistance and networking opportunities to small business owners, OHFI will provide loans to Black, Indigenous and other business owners of color using character-based lending — a form of lending that takes a holistic approach to approving loan applicants.
“Life just happens,” said OHFI CEO Chad Cooper. “People are trying to get back on their feet. And so, when we talk to people, and we get an idea of who they are … we will be able to make a more informed decision on whether or not we would be able to lend to that person.”
The financial institution received $150,000 to loan to businesses from the Black Community Investment Fund, which was established in 2020. Last year, the fund, part of the broader One Albuquerque fund, awarded $300,000 to a dozen Black-owned businesses and nonprofits in Albuquerque.
OHFI also received a $1.5 million grant from the W.K. Kellogg Foundation.
“I think it’s also important not just to lend money to people, but to also lend it to them at a fair rate,” Cooper said. “Especially minority owned businesses, so many of our businesses have either been denied loans, or if they do receive loans, they received them at a rate so high that there’s nothing really left to reinvest in their business.”
The 2021 Report on Firms Owned by People of Color, based on a small business credit survey performed by the federal reserve banks of 12 cities around the country, found that Black- and Latino-owned firms were far less likely than their white counterparts to be approved by lenders.
OHFI is in the process of hiring staff, including an office manager, loan processor, and part-time consultants, and establishing an office space at 100 Gold SW. Cooper said they expect to start making loans to businesses in quarter 2 of this year.
Cooper has been a financial adviser in the Albuquerque area for many years. This is the first time he’s worked on the lending side.
“For me, it feels like a culmination of work that I, and I know a lot of our board members and a lot of my friends, that we’ve been doing in the city for a long time, trying to build up and uplift our communities,” Cooper said. “Really just putting in the time and the effort and the work to build up these communities in the city that we love.”
