Church’s Economic Justice Loan Fund supports communities’ equitable access to capital

Atlanta, Georgia-based Access to Capital for Entrepreneurs is one of many Community Development Financial Institutions to which The Episcopal Church has provided low-interest loans through its Economic Justice Loan Fund. In turn, ACE provides loans to Atlanta-area small businesses, such as Bespokuture, a Black-owned clothing company. Photo: Jordan Luke

With help from secular and faith-based investors, including The Episcopal Church, the Fort Pierce, Florida-based Solar and Energy Loan Fund makes it possible for low-income homeowners to make energy efficient updates to their homes by lending them money at below market interest rates.

About 57 percent of people with credit scores at or below 680 were rejected for loans in the first half of 2023 alone. For women, people of color and elderly people, as well as people with low incomes and disabilities, not having access to loans is both a social justice and an equity issue.

“How do we promote economic justice, climate equity, solar for all if almost half of America doesn’t have savings and cannot access financing?” Doug Coward, director of national expansion and partnerships for the Solar and Energy Loan Fund, told Episcopal News Service. “That’s where SELF comes in, to fill in that critical gap.”

To help low-income homeowners make energy efficient updates and accumulate home equity, SELF borrows money from investors, including a $300,000 low-interest loan from the Economic Justice Loan Fund, a ministry of The Episcopal Church. SELF uses the money to offer below-market interest rate loans to homeowners. The homeowners then use the money to finance various cost-saving home energy efficiency projects, like installing new windows and roofs, which increase home values.

“Primarily what we do is help those that are on the marginal space of the communities, those that don’t have the financial means,” Margareth Crosnier de Bellaistre, the church’s director, investment manager and banking financer, told Episcopal News Service. “I think it also illustrates how The Episcopal Church can work.”

SELF is one of many Community Development Financial Institutions, or CDFIs, The Episcopal Church has supported since 1998 through its Economic Justice Loan Fund. The fund promotes economic justice, a priority in The Episcopal Church’s social and religious witness. The CDFIs invest the money in economic development, affordable housing, job creation and other community programs.

“Jesus called us to help our neighbor regardless of their circumstances, and we know that, historically, minority businesses have had a more difficult time accessing capital at reasonable interest rates,” Kurt Barnes, the church’s chief financial officer, told Episcopal News Service. “We’re able to provide that capital below interest rates that they would likely get if they were going to their local commercial bank.”

Investment loans are approved and distributed on a rolling basis. In 2023, the Economic Justice Loan Committee approved six investments totaling $2.35 million of its $7 million fund. As of December 2023, $952,376 is still available for investment. Executive Council recently increased the fund to $9 million.

Loan amounts range between $150,000 and $500,000. Depending on the loan agreement, agencies have between three and five years to repay their loan at an interest rate between 2.5 and 3.5%, Barnes said. After the loan is paid off, they may request to continue borrowing from the church and increase their loan amount, he added.

The Economic Justice Loan Committee is a committee of Executive Council.

“It’s important for people to understand that we’re offering investments, not grants. Every dollar we loan comes back to The Episcopal Church with interest,” the Rev. Will Mebane, rector of St. Barnabas Memorial Episcopal Church in Falmouth, Massachusetts, told ENS. “The work that we do doesn’t cost the church anything. Really, the Economic Justice Loan program is one of the best kept secrets there is in The Episcopal Church.”

Most investment loan applicants and recipients are secular, Crosnier de Bellaistre said. However, even though they’re not affiliated with The Episcopal Church, they’re required to be endorsed by their local Episcopal bishop. The Economic Justice Loan Committee will sometimes ask diocesan bishops if they know of local CDFIs to consider investing in. Most applicants are based in the United States.

Another CDFI the committee is currently investing in is the Brunswick, Maine-based Genesis Community Loan Fund. The agency connects communities with resources to carry out development projects, such as affording housing, child day care centers, health care facilities and food pantries. When Genesis first applied for an investment loan, the Economic Justice Loan Committee approved $250,000. The second and current investment loan is $400,000.

“It’s been tremendous; [the Economic Justice Loan Committee] was wonderful in stepping up,” Liza Fleming-Ives, Genesis Community Loan Fund’s executive director, told ENS. “The need for the work that we do has only increased since COVID-19, so the fact that the committee was willing to commit capital to help us respond to that need during the pandemic, and increasing their investing when renewing, was incredibly meaningful to us.”

In Georgia, the Economic Justice Loan Committee has established a long-term partnership with Atlanta-based Access to Capital for Entrepreneurs, or ACE, the state’s largest small business-focused CDFI. Statewide, the nonprofit provides financial, business development and community development resources to women, people living in low-income communities and people of color, particularly Black and Latino communities. In 2023, the committee renewed and increased its investment loan in ACE with a $400,000 loan.

“Equitable access to capital, reducing barriers, helping businesses build assets and create jobs, and supporting communities and families aligns with economic justice,” Martina Edwards, ACE’s chief of strategic partnerships, told ENS. “Small business ownership, similar to home ownership, is a pathway to wealth creation, which also supports economic justice.”

Coward said SELF wouldn’t exist today if it weren’t for support from its investors, especially the faith-based ones like the Economic Justice Loan Fund.

“When we first set up this program, the large banks didn’t want to invest in us. It was the faith-based organizations that helped us establish a proven track record, and now the rest of the country is looking at us as a model to either work with directly,” he said. “The impact of [the Economic Justice Loan Fund’s] investment is beyond just the direct benefit to the homeowner and the contractors who do the work, and I think it’s also set a great example for the country.”

Potential borrowers must contact Crosnier de Bellaistre directly to apply for a loan.

-Shireen Korkzan is a reporter and assistant editor for Episcopal News Service based in northern Indiana. She can be reached at skorkzan@episcopalchurch.org.