The U.S. Treasury Department's Financial Literacy and Education Commission (FLEC) held a public meeting July 20 which focused on the financial literacy and educational needs of Tribal and Native communities. The meeting also featured a panel on federal educational and financial literacy resources available to these communities.
U.S. Treasurer Chief Lynn Malerba spoke at the meeting and moderated a panel discussion with Native leaders, according to a Treasury announcement on the meeting. Malerba is also the 18th Chief of the Mohegan Tribe since 2010 and the first female Chief in the Tribe's modern history, her Treasury bio states.
"As we know well, financial literacy is a lifelong tool, intended to give people the resources they need to achieve financial stability," Malerba said in her remarks at the meeting. "This is especially true for Tribal communities, where financial literacy and access to reliable banking institutions can mean the difference between having an opportunity to have a comfortable and secure future or facing poverty."
Malerba said at the meeting that she has learned in the past year, in meeting with Tribal leaders and in speaking with individuals who live in Indian Country, about the interconnectedness of health, education, public safety, the environment and business development.
"Investment in these areas in Indian Country promotes a cycle of social and economic prosperity and contributes to building equitable wealth," she said, according to the transcript of her remarks.
Native Americans face higher poverty rates, live in overcrowded homes and suffer inequitable health status compared to other U.S. citizens, she stated, according to the transcript. A lack of access to capital and credit markets in Native communities create economic disparities, she said, while noting that the average distance between a reservation and the nearest bank is 12 miles, more than three times higher than the national average, the release states. Limited access to high-speed internet further exacerbates banking for Native people, she stated at the meeting.
"This disconnect from mainstream financial institutions creates a barrier to financial literacy, conventional financing and economic stability," Malerba said at the meeting.
She also said that some banks hesitate to locate a bank branch office or to make loans on reservations because they don't know how to navigate sovereign immunity, tribal jurisdiction or the status of land held in trust, according to the transcript.
"We know that having a relationship with a local bank is essential to building a credit score, long-term economic growth, and financial security," Malerba said, the transcript reports.
She credited Native American banks, credit unions and community development financial institutions (CDFIs) for "stepping in" to provide banking services and financial education in areas "largely ignored" by conventional banks.
"These institutions are paving a path for economic prosperity for Native communities," she said at the meeting.
Malerba emphasized the substantial contributions that Indian Country contributes to the overall U.S. economy. Native people, who make up only 1.7% of the U.S. population, have "tremendous buying power," she said, of approximately $115 billion in the years before the COVID-19 pandemic, according to the transcript.
However, Malerba also noted that Native business owners often rely heavily on credit cards because of their limited access to capital, and many small business owners lack a clear understanding of their financials, which affects their ability to make sound business decisions and achieve profitability, according to the transcript.
Malerba highlighted the American Rescue Plan's State Small Business Credit Initiative (SSBCI), which allocates $500 million specifically for Tribal governments to invest in Tribal enterprises and small businesses. She also spoke about the small business opportunities offered by the Inflation Reduction Act and various initiatives in President Joseph Biden's Investing in America agenda.
"With the right resources, supporting financial literacy can help Tribal citizens build good credit, save for emergencies, go to college, and afford stable housing by owning or renting a home – all of which contribute to a stronger Tribal economy," Malerba said.