Our challenges

One of the primary challenges that CEF has faced so far is one of the most essential: how do we ensure repayment? From the traditional banking standpoint, the main determinant of whether or not a loan is approved with whether or not the loan officer judges that the borrower will be able to repay. We are, of course, also concerned with a borrower's ability to repay, but mainly from the standpoint that we want the loaned funds to first and foremost contribute to that individual's personal advancement. In the commercial sector, the "5 C's" they define as criteria in loan approvals are: capital, collateral, credit, capacity and character. We have had to find our own ways to build towards these 5 C's, and alternative ways of measuring and defining these traits in an applicant.

One related question always comes back to how can we make the process easy, but not too easy -- so that it can be at least a little bit self-selecting, but not prohibitive. We are still working to find a balance between up-front requirements that can tie people to the program while allowing us to build credit and collateral internally, and a program that can remain flexible and responsive to individual's time constraints and particular circumstances.

These and related questions will be the main point that I will be trying to get at in my upcoming interviews.