A Black-led credit union in north Minneapolis is on track to open as early as next summer. The recently renamed Village Financial Cooperative has garnered 1,600 pledged members since the project began in February 2017. Director of Development Me’Lea Connelly called such a high level of engagement “unprecedented” so early in the game. “The potential of this investment is huge,” said Connelly at a recent Minneapolis panel addressing cooperative economies and Black-led co-ops. “The potential of us using this to address economic disparity is real.”
Among the supporters of the new venture is Minneapolis Mayor Jacob Frey. In his first budget address in August, Frey earmarked $500,000 of the city budget for the Village Financial Cooperative, though those designated funds must be confirmed by the Minneapolis City Council at its December meeting in order to become a reality.
Reich stated that Council Members Cam Gordon and Jeremiah Ellison were also “gung ho” in their support, having seen how effective co-ops were in empowering their communities. Connelly urged pledged members of the credit union to contact their City Council members to express their support for funding the credit union.
Village Financial Cooperative Credit Union must pass at least two major steps before it can open its doors. Its charter must be approved by the Minnesota Department of Commerce. Paperwork has been filed, and the department has until mid-fall to make its decision. Pending approval, the credit union must also file with the National Credit Union Administration — the credit union equivalent of the FDIC — which would have 90 days to approve Village Financial for insurance. “If all goes well,” Connelly said, “we’re looking at a grand opening in June 2019.”
A credit union differs from a bank in that it is a member-owned cooperative. As with food co-ops, members own and derive benefits from the business, proportional to their use. “Co-ops take the economics of our lives and recycle it into the community,” said panel member Sean Doyle of Seward Community Co-op. “They’re a non-extractive economic model.”
The stated goal of Village Financial on its website is to “serve the underserved Black community of North Minneapolis, who have been preyed upon and excluded from the traditional financial institutions.” As Connelly put it, “We are making sure that we have credit unions that are owned and led by folks that are carrying the burden that the injustice that our current system has burdened us with.”
Though its opening would be nearly a year off, the credit union is already running three programs to address the needs of its community members. At the panel, Connelly spoke of a pledged credit union member who reported long Friday-night lines at a Walmart service desk, as people waited to have their paychecks cashed for a small fee. Village Credit Financial partnered with Exodus Lending to offer check cashing, allowing pledged members to cash paychecks without having established a checking account. The partners also offer a cooperative start-up loan, to support other budding cooperatives in the area, and a New Day Loan program designed to combat predatory payday loans. The New Day Loan program provides loans of up to $500 for up to 6 months, under flexible terms. Interest rates are 0 – 8 percent, according to Shiranthi Goonathilaka, the credit union’s Director of Engagement and Experience. The interest payments go to further support Village Financial.
The idea for a Black-led credit union in North Minneapolis grew out of Blexit, an activist volunteer organization founded by Connelly in 2016. In response to the death of Philando Castile, Blexit explored ways to respond to violence within the black community through economic civil resistance. The Association for Black Economic Power (ABEP) grew out of Blexit, and they formed the credit union. In seeking to brand the new enterprise, ABEP sought name recommendations from its pledged members. The idea of a village working together appeared in several suggestions, said Goonathilaka, and Village Financial Cooperative earned its name.
The credit union also has a physical presence in Minneapolis: 227 Colfax Avenue N, Suite 230. Drop-in hours are Monday-Friday, 9 until noon. Those interested in pledging membership may do so on the website as well. Membership is open to anyone who lives, works, worships, or attends school in Hennepin or Ramsey Counties.
Those looking to launch a cooperative business can find assistance at both city and non-profit levels. The City of Minneapolis supports potential and new co-ops through its Co-operative Technical Assistance Program (C-TAP). The program offers free feasibility training and technical assistance to new cooperatives. Nexus Community Partners runs the Northstar Black Cooperative Fellowship to support entrepreneurs seeking to start cooperative businesses. The first annual Coop Fest and bike tour will be held at Seward Café on October 6th from 4-8:30 PM.