Seven years ago, in July of 2012, the Native American Financial Services Association (NAFSA) was formed when two smaller groups—the Native American Lending Alliance and the Native American Fair Commerce Coalition—decided to join forces. In so doing, they could pool their resources to more strategically fight back against criticism of Tribal Businesses offering loans via the Internet.
At that time, online lending was a relatively new industry for Tribes looking to find innovative avenues of economic development and economic diversification. And it was a perfect fit. For Tribes on geographically isolated reservations, especially those where gaming revenues were feeling the results of the nationwide economic recession, the Internet provided a superhighway to Indian Country, enabling customers to access Tribally provided financial products from the comfort of their home, office, or mobile device.
For many Tribes, the online lending industry was the breakthrough they were waiting for, and it created an unquestionable abundance of opportunity for them. It filled slumping general budgets, created critical sources of revenue, and provided the essential services that Tribal governments needed to support.
Much of NAFSA’s work in those early years focused on advocacy and education—two activities that remain part of our core mission to this day. The types of loans that NAFSA members provide were under attack then, just as they are today—albeit on different fronts.
And as an organization, NAFSA engaged in some of the biggest battles facing online lending over the past decade, particularly Operation Choke Point, efforts by the New York Department of Financial Services to eliminate online lenders’ ACH Access, and the early days of the Consumer Financial Protection Bureau.
On a separate track, NAFSA focused on providing vital education to elected officials, regulators, and the public at large about sovereignty: what it means, why it is important, and its history as a key component of Tribal self-governance since time immemorial.
The organization also spent considerable resources highlighting the government-to-government relationship between Tribes and the United States, as well as the Executive Order 13175 mandate that federal departments and agencies engage in consultation and coordination with Tribal governments when considering policies that would impact Tribal communities.
And finally, there was a concerted effort to educate about the issues affecting Indian Country and the potential to solve these issues through Internet-enabled economic development like Tribal online lending.
It’s a point of pride to be able to stand here today, looking back at these major battles in our rear-view mirror and looking at the robust online lending industry that doesn’t merely exist, but is flourishing. Many of the Tribes who attended the meeting when NAFSA was founded are now running major Tribal lending enterprises and, in some cases, are acquiring the vendors who provided services to their business at the outset. This vertical integration, in which Tribes are managing more and more aspects of the business in-house, is the future and where we see many Tribes headed as they grow their footprint in the industry.
While NAFSA was founded as an organization focused on protecting Tribal sovereignty in the online Tribal lending industry, we are now growing our focus as Tribes become more and more involved in other segments of the industry, including banks, credit unions, and sovereign wealth funds. We would be truly remiss to ignore those advances and the role that they are playing in Tribal economic development. NAFSA will help lead the way for a transition into the broader financial services marketplace.
In less than a decade, we’ve seen Tribal Financial Services, particularly the online lending sector, grow tremendously. NAFSA is both proud and fortunate to have been a part of that growth. And as Tribes expand into other financial service sectors, we want to continue enabling our current and future members to succeed.
Mika Leonard is the Chief Operations Officer of the Native American Financial Services Association (NAFSA). She is an enrolled member of the Miami Tribe of Oklahoma, a native of Oxford, Ohio, the ancestral homelands of the Tribe, and a graduate of Miami University in Oxford with a Bachelor's Degree in Linguistics. Granddaughter of the late Chief Floyd Leonard, Mika has been active in the Miami Tribal community since an early age, and has dedicated her professional life to fostering economic development within Indian Country.