Forza Financial
Contributing Writer, Elisabeth García
Forza
Financial isn’t your average student organization. It’s an innovative lending
institution mirrored in only two other universities in the U.S.
Forza, “strength” in Italian, is an
organization designed to help low-income entrepreneurs get their start, said
David Bailey, the organization’s president.
He said many of these people have
poor or no credit scores and cannot find loans.
“Almost none of our borrowers have
a banking relationship,” Bailey said. “They don’t even have a checking
account.”
That’s where Forza, a nonprofit
organization, steps in. Bailey said many times, the reason entrepreneurs cannot
get a loan is not their ability to pay it back but the circumstances in their
lives. Forza works to re-gauge an applicant’s credit score and approve them for
a loan.
Bailey said Forza only charges
10-20 percent compared to the rates of money lenders- 50 percent/month- and
cash advance- 453 percent/year.
The company was started in the fall
of 2009 when Bailey presented his idea to faculty at UA. Two other students,
Alex Murray and Matt Miller, had similar ideas and the three formed Forza
Financial.
From there, it’s become a company
staffed entirely by more than 24 students, which might seem like an
impossibility when you hear words like “microfinance” and “lending
institution.”
“It is business-based but students
do 100 percent of the work,” he said. “The beauty of what we’re doing is we use
student labor.”
Even the company’s website was
completely designed by students. These staffers earn independent study credit
through the Honors College, Bailey said.
Eventually, he would like to
introduce a microfinance class on campus. This is quite an advancement for UA
considering the fact that a microfinance minor doesn’t exist.
The company also offers free
classes to their lenders that cover issues from tax returns to creating a
budget. Bailey said they hope to build a calendar with other companies to offer
more classes.
The classes are one condition that
lenders face in order to get a loan. Bailey said many of the loans are
recommended from community leaders, such as church pastors. This makes social
collateral, the company’s insurance, work so well.
Bailey said six people will be
grouped into threes as borrowers. The second three cannot receive their loan
until the first three have paid off a substantial portion of their loan.
This creates a peer pressure that
makes the borrowing system so successful. The fear of a whole church judging
you for not repaying your loan and inhibiting a fellow member’s loan is a big
motivator, Bailey said.
He
also emphasized the fact that Forza isn’t just seeking outside lenders in the
community.
“We also lend to students,” he
said. “One of the most underserved populations for credit is students.”
Bailey said the company’s goal is
to establish this kind of business throughout the southeast. They also want to
build their research, making the more marketable to banking partners.
A possible reality TV show is also
rumored but details are yet to be released, he said.
For now, members are working hard
and empowering each other to go further, Bailey said. Chief officers meet every
Sunday, the whole group meets monthly, and each team meets once a week to
develop ideas.
“At the bare minimum, the least
that someone spends is three hours,” he said.
Some members spend as much as 20-30
hours a week, speaking to the dedication of the staff. Bailey said the ability
to change lives is a driving force that excites so many Forza workers.
“I could not speak highly enough
about the quality and caliber of everyone in the program,” he said.
Bailey said more UA students are
welcome to be part of this with several areas of involvement. First, students
should go to Forza’s website and check out the company’s history.
Next, students should connect
through Facebook or Twitter and contact one of the chief officers.
Bailey said they’re seeking
independent applicants with good people skills but who aren’t over-committed.
“When you commit to something in
Forza, it is paramount that you do it,” he said.