Partnership serving to immigrants in Maine receive zero-interest enterprise loans

Deborah Bafongo began her South Portland enterprise, Angels of Love Occasion Design, in 2019 with none outdoors loans or grants.

Bafongo focuses on offering decorations for formal occasions, particularly weddings, and had hoped she would have the ability to work on sufficient weddings in 2020 to have the ability to earn again the cash she spent on tools. Nevertheless, when the pandemic hit and weddings have been canceled en masse, Bafongo discovered herself in want of some further assist to maintain her enterprise afloat.

Via a mutual pal, she heard a couple of program being provided via the Larger Portland Immigrant Welcome Middle that would offer interest-free loans to enterprise house owners like her. Bafongo, who immigrated from the Democratic Republic of Congo in 2014 and lives in South Portland, obtained a mortgage of $2,500 with a reimbursement time period of 21 months. She plans to make use of the funding to buy an even bigger storage unit to make use of as a showroom for her designs, in addition to extra tools.

“I actually wanted the funds,” she mentioned. “As an immigrant, I’m actually grateful that this platform is there to assist us succeed within the profession that we’re doing. … At that time (due to the pandemic), I actually wanted one thing coming from someplace to help me.”

INNOVATIVE PARTNERSHIP

The funding for Bafongo’s enterprise is the results of a partnership between DreamxAmerica, or DxA – a nationwide initiative combining storytelling and affect to assist immigrant communities based by Andrew Leon Hanna in 2018 – and Kiva, a nonprofit that permits folks to lend cash on-line.

DxA launched the storytelling part of its challenge, a documentary that includes three immigrant entrepreneurs in North Carolina, in November 2020. When it got here time to launch the affect aspect of DxA’s challenge, Hanna approached Rohit Agarwal – the pinnacle of Kiva’s U.S. program and a connection from the time that each spent working at world administration consulting agency McKinsey & Firm – to type a partnership that would present funding for immigrant enterprise house owners.

Immigrant entrepreneurs can face challenges accessing conventional financial institution loans – generally as a result of they lack established U.S. credit score histories and generally due to racial or cultural discrimination.

“Numerous occasions, the banking system doesn’t deal with low-income minority immigrant people in addition to they need to,” Hanna mentioned. “Generally, there’s a number of mistrust and generally there are charges which can be unfair. … Why we recognize Kiva is that (the mortgage) may be very pure, it’s very easy. There’s not any charge to analysis or different hidden charges. It’s zero curiosity, zero charges.”

DxA companions with 4 native organizations nationally – together with the Welcome Middle – that publicize the mortgage alternative and assist enterprise house owners all through the appliance course of. Workers at DxA edit functions to inform their tales extra concisely in an effort to draw as many lenders as doable, and a workforce at Kiva reads the official functions and determines the mortgage quantity the enterprise qualifies for. Then, DxA promotes the enterprise proprietor’s borrower profile till the mortgage is totally funded.

Agarwal mentioned the native organizations DxA companions with are essential to constructing belief in Kiva’s mortgage program.

“The principle manner for us to construct belief – and inside a number of these communities there may be rightfully an honest quantity of mistrust in conventional monetary establishments – is thru trusted companions on the bottom,” Agarwal mentioned. “And there enters DreamxAmerica, which I believe has finished a improbable job constructing belief via immigrant welcoming facilities (and) via completely different different intermediaries to say, ‘Hey, right here’s a superb supply of capital, zero-fee, zero-interest.’”

These native organizations usually have already got shut partnerships with immigrant enterprise house owners and might function a trusted middleman.

“Most small-business immigrant entrepreneurs aren’t going to only wander onto the Kiva web site and say, ‘Oh, this seems good,’” Hanna mentioned. “You want any person to vouch for it.”

Navid Ahadzadeh, a recipient of an $8,500 interest-free mortgage for his Casco-based enterprise, Scratch Grasp Cell, a touring auto restore store, used a part of the mortgage to buy a brand new van. Derek Davis/Workers Photographer

IMMIGRANT ENTREPRENEURS

The Welcome Middle’s enterprise hub, which was began in 2017, performs that position in Maine by connecting immigrant enterprise house owners with varied sources of capital.

“Analysis reveals that immigrants, nationally, usually tend to begin companies and small companies than native-born People,” mentioned Reza Jalali, the middle’s government director. “By doing so, (enterprise house owners) create jobs not just for themselves however for others locally. A part of what we do at (the) enterprise hub is assist immigrants to entry funding after which assist match them with lenders.”

To this point, seven Maine enterprise house owners have had their loans totally funded via the DxA-Kiva Particular Initiative, with two others nonetheless within the technique of being funded.

Navid Ahadzadeh, the founder and proprietor of Scratch Grasp Cell, a cell auto restore service primarily based in Casco, knew Jalali via the native Iranian immigrant group and efficiently utilized for an $8,500 mortgage to develop his enterprise. He used a part of the mortgage to purchase a brand new van.

“As a result of my enterprise is a cell enterprise and (due to) my outdated van, the choices I’ve have been type of restricted,” Ahadzadeh mentioned. “So once I get an even bigger van, it (will probably be) extra dependable, extra skilled. It is going to look skilled.”

Ahadzadeh moved to the U.S. in 2009 from Sari, Iran, due to persecution in his residence nation that restricted his profession choices.

“I’m a Baha’i, and the Baha’i is a extremely persecuted non secular minority in Iran,” Ahadzadeh mentioned. “Baha’is in Iran should not allowed to pursue larger schooling, and lots of companies owned by Baha’is are shut down by the federal government. So realizing that folks on the market are serving to you for the mortgage and all the things else in a foreign country simply makes me very glad.”

USEFUL FOR MUSLIMS

Along with serving to with immigrant enterprise house owners’ restricted entry to capital, interest-free loans have a spiritual significance for a lot of, as nicely. Historically, Islamic regulation forbids paying curiosity on loans, main many Muslim immigrant enterprise house owners to hunt loans from sources aside from conventional banks. This was the case for Humza Khan, the founding father of Inclusion Maine, a range, fairness and inclusion consulting agency primarily based in Westbrook. He obtained a mortgage of $6,500.

Humza Khan

“One factor that me about this program was the interest-free part of it,” mentioned Khan, who was born in Pakistan however grew up largely in Maine. “I might clearly go to – anyone can go to a financial institution, or they’ll go to enterprise capital, they’ll go and lift the cash … however for me, actually for non secular causes, I needed to keep away from curiosity.”

“(With the mortgage), I can spend money on the issues that I’m engaged on and pay it off over a time period and nonetheless be in compliance with (my) non secular beliefs,” Khan added. “That’s what attracted me to this program versus a extra conventional possibility.”

Khan used a number of the funding to pay for extra promoting, however his predominant objective is to host a convention.

“One of many issues that I’m hoping to concentrate on is a convention for range and inclusion,” Khan mentioned. “So it’s a concentrate on bringing people collectively which can be on this work and studying about what the native challenges are and the way we are able to deal with them and what’s working. … I’m hoping that (the convention) received’t be too expensive for folk, so this mortgage will definitely assist with getting me began in making that doable. It has helped already.”

For Jalali, this system additionally is efficacious as a sign of the alternatives out there to immigrants in Maine.

“Bringing some cash into the state is all the time excellent news, and supporting our new neighbors who’ve been displaced by wars and famine and persecution,” Jalali mentioned. “So, it’s good for Maine in a state the place we’re coping with an growing older workforce. We want extra immigrants, and might (this program) turn out to be a method of attracting new immigrants?

“Can this be a manner that some immigrants in Vermont, New Hampshire, Massachusetts, will take a look at Maine and say, ‘Effectively, that’s an incredible state to go and begin a enterprise?’ This will probably be actually good for us in the long term to draw extra companies (and) extra younger individuals (who’re) expert, educated and motivated to return and add to the richness of our group.”

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