American Indian and Alaska Native (AI/AN) peoples have long faced barriers to asset building. More than half of AI/AN populations are un- or underbanked, financial services often don’t operate on reservations, and access to capital is difficult. Native peoples have been excluded from financial wealth accumulation through government asset stripping, industry redlining, and simple neglect, thanks to historic (and ongoing) discrimination, exclusion, and racism baked into government and private-sector policies. Solutions are within reach.
Recently, the Financial Security Program, the Oklahoma Native Assets Coalition, Inc (ONAC), and the Center for Native American Youth hosted an event featuring Native leaders representing various geographies, experiences, and tribal affiliations. The group discussed experiences in building assets and Indigenous perspectives on generational financial wealth. Finally, the speakers gave recommendations on how foundations, corporations, non-profits, and others can partner with tribal governments and Native-led nonprofits to build financial wealth in Native communities.
Lakota Vogel, Executive Director of the CDFI Four Bands Community Fund, explained that the core concept of wealth extends beyond financial well-being in her community.
“One of our Lakota elders named Albert White Hat said that wealth is more about circulation than accumulation,” she said, “so really when Natives talk about wealth, it’s more of a collective perspective versus individualistic.”
Vogel’s statement echoes a passage from “Wealth Building for Native Families and Communities,” by Christy Finsel and Karen Edwards. They wrote, “Assets are understood in Native communities to involve much more than money or financial success. Tribal sovereignty, Native languages and arts, natural resources such as water, kinship, housing, education, food security and family as well as commonly held assets such as land are considered to be significant assets in Native communities, assets that must be protected and strengthened.” (The essay is part of the book The Future of Building Wealth: Brief Essays on the Best Ideas to Build Wealth—for Everyone.)
ONAC has produced a “List of Eighteen Suggestions to Better Support Native Practitioners Administering Asset Building Programs in their Communities,” and additional suggestions are included in Finsel and Edwards’ paper.
1. Reconsider “racial equity” by including the Native perspective.
“What we are hearing from foundations more recently is that we don’t fit into the racial equity piece,” said Finsel. “Native communities literally are not listed as eligible to apply.”
“There are legal structures that make Indigenous people different than other ethnic minorities,” said Sarah EchoHawk, CEO of the American Indian Science and Engineering Society. “We have those similar challenges that other ethnic minorities have, but we also have these different legal constructs and policies.” Non-governmental partners should redefine their equity strategies to make sure AI/AN communities are included.
Furthermore, foundations ignore Native investment because the populations are sometimes too sparse. “Some of us are hearing that we serve too rural and too small of populations,” EchoHawk said, “but you know those populations still have to be served, and no one else is going to do it if we aren’t doing it.”
Foundations, corporations, and other partners must also stop worrying that Native-serving organizations don’t have the staff to properly administer outside monetary support; they are often understaffed only because they are under-resourced. “I think we would hire up,” said Finsel.
2. Understand the uniqueness of AI/AN history, policy, and current programs.
Assets that might be used for collateral exist in different forms in Native communities, often because land and other assets have been stripped by long-standing government policy or are communally owned by tribes or villages. “There are 56 million acres of land in the United States that are held by trust or interest by the Federal Government,” noted Vogel. This land is not valued the way the rest of land in the United States is valued, and this has kept Native Americans from building wealth. Traditional banks needn’t be hesitant to lend under these conditions, though, thanks to support through federal programs such as the Indian Home Loan Guarantee Program.
Physical and virtual access to banking institutions are also in need of improvement, and though financial technology shows promise, it’s not the perfect solution. “We’re excited about fintech options, but we need that plus in-person options, where there’s a trusted relationship with an individual coming in,” said Finsel. Access requires “being able to help people navigate when they aren’t banked and don’t have an email address and are on a flip phone.”
3. Restructure partnership and grant-making criteria.
To better serve the AI/AN populations, organizations should reconsider the ways in which they make grant money available. One-year grants aren’t sufficient to create a culture of wealth because they lack the dependability and compounding benefits that longer terms create. Grantors should move to longer-term funding, on the order of five- to ten-year investments.
There should also be a rethinking of application processes because decisions are made differently in a tribal context. According to the Eighteen Suggestions, grantors should “build in sufficient time, in RFPs, for tribal governments to take a grant proposal to tribal council for approval, if that is part of their process for grant applications. Many often need at least one month to move through that part of the grant application process within their government requirements.”
Outside organizations who are used to relying on data for decision making should consider that data isn’t perfect—or sufficient—in a Native context. “Data is a human artifact and in colonizing nation-states such as America it’s a race reality,” said Vogel. “You have to tease out that this reality emerges, not through mathematical analytical techniques, but through the social, racial, and cultural standpoint of the creators. So this is why it’s really important to have Natives collecting and analyzing and reporting on their own data.” Organizations should oversample populations to get better data, and trust the local organizations to have a clear picture of community needs.
4. Trust that Native leaders know what their communities need.
Native people know what works best for their communities, including services such as access to credit-builder loans, emergency funds, and college savings accounts. Financial coaching is also important in a population that has been systemically excluded. “When we send our youth out…whether to school or entering a trade or careers, they need to have financial literacy, to be comfortable working in an outside market,” said Rory Wheeler, Youth Advisory Board member of the Center for Native American Youth. With the help of a nonprofit, Wheeler’s Seneca Nation community started a program to teach those skills to 17-year-olds through in-person and online classes.
Vogel said people come to her office and ask, “Can you tell me why I can’t get a car loan because somebody says I don’t have a credit score?” This informational isolation from the mainstream banking system also means that Natives are credit invisible to non-Native institutions. “If they take the courage to walk into our building,” she said, “the least we can do is explain what a credit score does, and how it impacts your trajectory as an American.” From there, local organizations work with individuals to improve access to credit.
More broadly—and perhaps most importantly—organizations that want to improve the financial health of Native communities should work with existing Native resources rather than build new systems. Local organizations have established legacies of trust in communities, and it’s simply more effective to direct financial support to the Native-led nonprofits and tribal governments that directly provide asset-building services. These organizations also have the ability to scale up services that include online banking access, social service application assistance, business banking infrastructure, and financial advisement and investment monitoring.
To engage with Native communities, the financial world needs a shift in attitude and approach that recognizes the uniqueness of the challenge, and that takes advantage of the expertise of the people who are currently doing to the work of building Native wealth.
View the entire discussion here.