High Risk Lender Is Still Lending After 10 Years Washington’s Cascadia Revolving Fund Is Named To Receive Presidential Award
Ten years after it began providing loans to the “riskiest of the riskiest” credit prospects, the Cascadia Revolving Fund is going strong - and even winning presidential recognition.
The fund helps people such as Nancy Stratton - a single mother and former welfare recipient who needed $1,500 to build a fence around her Port Hadlock trailer so she could start a day-care center.
Instead of going to a bank, she wrote to Cascadia, which anted up a $6,000 loan to build the fence and refinance the mobile home at a lower interest rate.
She has never missed a loan payment, said Shaw Canale, a former commercial banker and acting executive director of Cascadia, at a “microcredit town hall” meeting that drew 50 people Sunday.
Cascadia “is not going to change the entire world, but one person’s life is going to improve,” Canale said.
Cascadia is one of four outfits nationwide that are being honored Thursday by President Clinton, first lady Hillary Rodham Clinton and Treasury Secretary Robert Rubin for excellence in micro-enterprise lending.
Ten years after Cascadia was established, 90 percent of its borrowers are still in business, Canale said.
“Fewer than 1 percent of our borrowers, who are among the riskiest of the riskiest credit prospects, have failed to pay us back. That’s a rate that any bank would envy,” she added.
The microcredit concept originated in 1983 in Bangladesh, one of the world’s poorest countries.
Those who receive loans from Cascadia typically become members of borrower groups, usually five people who become jointly responsible for each individual’s loan.
Kerri DeNoble, 33, of Tacoma, was newly divorced with two sons, the youngest a year old, and struggling to get off welfare six years ago.
She wanted to start her own sewing business but had only a household sewing machine that could barely handle the piece-work she did at home for a dry cleaner.
Then came a postcard from Washington Community Alliance for Self-Help, or CASH, an organization she had never heard of, offering her a loan and help in learning bookkeeping, time management, marketing and other skills.
She wound up getting $500 to buy an industrial sewing machine, go off welfare, move out of public housing and find a bigger home. Besides her home business, she now does alterations for a tuxedo rental shop and plans to seek another loan to buy more equipment.
“I think one of the things I had to overcome was fear,” DeNoble said. “The fear I have is of not making it, because I don’t want ever to go back on public assistance.”