Native CDFIs bring holistic approach to assessing credit risk

Client relationships reduce uncertainty in lending outcomes

February 2, 2023

A scene from Mazaska Owecaso Otipi Financial, a Native Community Development Financial Institution (Native CDFI) in Pine Ridge, S.D. Mazaska was one of 11 Native CDFI loan funds to provide data for a study of Native CDFI lending outcomes. Jeffries Design/Image courtesy of Mazaska Owecaso Otipi Financial

Read Here:

https://www.minneapolisfed.org/article/2023/native-cdfis-bring-holistic-approach-to-assessing-credit-risk

Article Highlights

• Many Native CDFIs expand loan access with character-based criteria

• Results from 11 Native CDFI loan funds provide early evidence of success

• Character scores may better measure predicted delinquency than credit scores