NAACP WANTS TO START GOOD FAITH FUND

The local chapter of the NAACP is working with a state agency to try and implement a community-based self employment fund that will promote opportunities for entrepreneurship among low income people.

The plan, known as the Good Faith Fund, has worked in the state of Arkansas as well as Bangladesh. The idea is being proposed around the state by Mark Miller, director of Minority Business Development for the Office of Administration.

Miller was in Cape Girardeau this week to discuss the project after being contacted by members of the local NAACP about ways to stimulate economic opportunities for low income people in Southeast Missouri. One solution offered by Miller was the Good Faith Fund.

"This is a self-help initiative for low income people and we hope to establish something similar to this in the state of Missouri," explained Miller. He stressed that the program is focused on helping individuals who have no business experience or collateral to secure a loan to start a business, but have a particular talent or skill they want to develop into a business.

One or more banks would provide funds to be loaned through the fund. A bank loan officer would serve on the committee that decides who gets the funds.

Under the program in Arkansas, members pay a $10 fee that entitles them to attend meetings and special training programs on running a business. Borrowers are divided into groups and are required to attend regular meetings to develop business management skills.

Since the entire group makes final decisions on who is given loans, Miller said there is tremendous peer pressure to pay back the loans. In Arkansas, the loan repayment rate is 95 percent. "Peer group support is very important," said Miller.

"The key to the program is creating a relationship with a bank," noted Miller. Not only does the bank provide funds for the initial loans, but if a person does well in their business they have a relationship developed with the bank to go out and borrow larger sums of money for their business."

The maximum loan at the first stage is $1,500, and at the second level, the maximum loan is $5,000, under the plan used in Arkansas.

Even though the loan amounts are small, Miller said since most of the businesses are home based, it is enough to help someone to get started and develop the kind of technical skills needed to expand and be successful.

Michael Sterling, president of the Cape Girardeau NAACP chapter, pointed out that some of the participants in the program might be AFDC recipients and this will help people support themselves.

Debra Willis, who chairs the NAACP Community Action, added that with the likely changes in the welfare system that are being discussed, programs like this will become even more important.

"I think the Good Faith Fund is the answer to poverty," said Sterling.

Bernice Coar-Cobb, educational associate at Southeast Missouri State University, added that such a program "empowers people" and provides them an opportunity "to be in control of your destiny and your life."

Sterling said the local chapter will attempt to get the program started in the Cape area, and he also plans to promote it at the annual state meeting of the NAACP in Columbia later this month.

"We hope to have this in full swing by the first of the year," said Coar-Cobb.

Miller stressed the program can be designed to meet the needs of individual communities, and pledged the support of his office in promoting this program around Missouri.

"We want this to be part of our new economic agenda for the state," said Miller. "We have been looking around the state trying to find something to hit the grassroots level and this could be it."

To have successful programs, Miller said there needs to be strong interaction between the public sector and private sector.

Sterling said the NAACP will work to continue to develop a strong relationship with state organizations like the minority business development office.