Government should respect Native American sovereignty

As noted in your article, many tribal communities in Montana and, indeed, across the country, are overwhelmingly poor and geographically isolated. This is why tribal citizens, like many Americans, are becoming Internet innovators, starting businesses where proximity to a major population center is irrelevant.  The tribes we represent have found online financial services to be a geographically-neutral alternative to gaming enterprises and a critical source of revenue to meet on-going economic needs.  These online businesses, which are tribally owned and operated, support the essential services that many who live off the reservation take for granted, such as adequate housing, infrastructure and schools. They are also providing an important service to underbanked Americans who need short-term access to credit.

The tribal governments we represent provide small, short-term loans to Americans facing an emergency such as a medical expense or car repair. These loans are easily attainable, convenient, anonymous and accessible online.  Our customers are unlikely to receive a small-dollar bank loan or extension on a credit card since they are likely to be struggling with financial fragility long before they seek out our services online.  Many do not have a family member or a social network to which they can turn for cash or may not wish to face the indignity of asking.  While most government officials in Washington will never find themselves in such a situation, a recent FDIC National Survey of Unbanked and Underbanked Households found an estimated 7.7 percent of US Households (9 million people) do not have a checking or savings account, or are "unbanked."  In addition, an estimated 17.9 percent (21 million people) are "underbanked," defined as "those that have a checking or savings account but rely on alternative financial services such as check-cashing services, payday loans, rent-to-own agreements or pawn shops."

Our tribally-owned online lending services do not cause financial fragility, they reveal it.  Mainstream banks continue to offer fee-based services, mainly overdraft fees, that compete directly with short-term loans. Meanwhile, tribal online lending is improperly cast as "predatory," ignoring the fact that 100 percent of our customers are employed with an average annual income over $51,000 and repay their loans within 56 days.  All member tribes follow the Native American Financial Services Association’s best practices and abide by applicable federal law.

There exists a unique government-to-government relationship between the United States and tribal nations.  Our member tribes are keeping their end of the bargain. It's time for federal and state government officials and regulators to respect our inherent sovereignty, stop the false attacks on our businesses, end the misinformation campaign about what we do and come to the table to work with our Native American tribes to discuss good public policy for all financially fragile Americans.

Brandon is a citizen of the Muscogee (Creek) Nation and executive director of the Native American Financial Services Association.

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