A South Cumberland Partnership
BetterFi's inception began as part of the South Cumberland Plateau AmeriCorps VISTA Project, through the Economic Development Coordinator VISTA position between the University of the South's Office of Civic Engagement, their Babson Center for Global Commerce, and the South Cumberland Community Fund.
Identifying the Need
With assistance and guidance via local partnerships with the Grundy County Mayor's Office and the Rotary Club of Grundy County (among many), a series of potential economic development entity concepts were explored and developed. Through a series of stakeholder meetings and surveys, the clearest potential and need was found to be with a consumer microfinance loan fund, a community development loan fund (CDLF) that could operate both as an affordable alternative to predatory loans and as a means to develop financial knowledge.
BetterFi's Inception
With considerable expertise and support from local partners as well as the Sewanee and South Cumberland Plateau communities at large, BetterFi was incorporated on October 13, 2017. BetterFi filed for tax exempt status from the IRS shortly thereafter, and began developing a board, funding, and a plan to pilot a predatory loan alternative in Franklin, Grundy, and Marion counties.
The Pilot Begins
At the start of 2018, Tower Community Bank began to provide resources to evaluate cooperation with BetterFi, culminating in a partnership that allowed BetterFi to proceed and begin operations. BetterFi's pilot began in April 2018, we received 501(c)(3) non-profit status on May 17, 2018, and we disbursed 10 initial consumer loans to identify the needed infrastructure and systems.
Expanding the Pilot
BetterFi began slowly ramping up loan disbursals, and we then began addressing gaps in necessary systems, policies, and procedures in anticipation of eventual expansion.
In 2019, BetterFi was one of 5 recipients of a national Excellence in AmeriCorps award, receiving recognition as the “Most Significant Innovation.”
An Appalachian CDFI
As BetterFi continued to disburse new loans and improve upon our underlying processes, we were certified by the US Department of Treasury as a Community Development Financial Institution (CDFI) at the end of 2020. In 2021 we were among the inaugural recipients of the CDFI Fund’s first Small Dollar Loan (SDL) grant program.
Expanding into Hamilton Co.
After weathering the worst of COVID-19, BetterFi began executing plans to expand our geographic footprint in 2023, first targeting nearby Hamilton County — home of Chattanooga and an estimated 32,500 unbanked and underbanked households.