The NET Fund
In the spring of 2019 the Southeast Center for Cooperative Development and Free Hearts, an organization led by formerly incarcerated women, providing support, education, and advocacy to families impacted by incarceration as it pursues opportunities to create jobs, training and financial support for individuals reentering, formed an alliance to create a local non-extractive loan fund to support minority worker cooperatives start-ups and conversions.
This loan fund, the New Economy of Tennessee Fund (NET Fund), is part of Seed Commons, a community wealth cooperative that shares capital and resources to support local cooperative businesses create jobs, build collective economic power, and wealth for people of color, formerly incarcerated individuals, immigrants, and others who must overcome great barriers to participate in the economy.
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Información
Los Principios de Seed Commons
The unique aspect of a non-extractive loan fund is that the returns to the lender never exceed the wealth created by the borrower.
For the cooperative this means that a loan with a Seed Commons peer fund will actually benefit the borrower following these common non-extractive terms:
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Borrowers are not required to make interest or principal repayments until they are able to cover operating costs, including market-rate salaries.
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Financing agreements never use assets for security unless the asset has been purchased with the financing agreement proceeds
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Instead of credit scores, Seed Commons uses close relationships between local loan officers and potential loan recipients to establish a borrower’s reliability
Seed Commons and the NET Fund aim to bring ownership and wealth based on democratic principles and capital that is subordinate to the needs of people and to the community.
If you are interested in learning more about this loan fund for cooperatives, please fill out this intake form HERE and submit.
CHECK OUT OUR BLOG EXPLAINING OUR WORK, HERE.