Frequently Asked Questions
What is the Cooperative Fund of the Northeast (CFNE)?
The Cooperative Fund of the Northeast is a community development financial institution (CDFI) that makes loans to cooperatives, employee owned businesses, and community based nonprofits.
Why did CFNE change its name?
In February, 2022 we changed our name from Cooperative Fund of New England to Cooperative Fund of the Northeast.
Primarily, this change reflects the fact that we have deepened our work outside of New England by hiring two New York staff members last year, Johan Matthews and Joe Marraffino. While in the past we have financed a limited number of co-ops in NY State, we are expanding our work in the state, including hiring staff there, and wanted our name to reflect our whole service area.
Please see our Name Change FAQ for other answers to questions related to our name change.
Where does CFNE get its money?
Socially responsible investment loans are made by various individuals, religious organizations, cooperatives, banks, intermediaries and foundations.
To whom does CFNE lend?
We make loans to cooperatives, employee owned businesses, and community based nonprofits in New England and New York.
What is a cooperative?
A cooperative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise. (International Cooperative Alliance Statement on the Cooperative Identity)
Cooperatives exist in every sector of the economy, including food retail, housing, agriculture, financial services, and manufacturing. Profits from cooperatives aren’t siphoned off to a single outside owner, but reinvested in the community fro which they came, serving their own members economically, socially, and educationally.
Cooperatives are community-builders. People often shop at, live in, or work for cooperatives because co-ops make a special effort to be active participants in improving the lives of neighborhood families.
Cooperatives are democracies. All co-op members have a voice in making decisions about what direction the enterprise takes. In this way, members gain valuable skills in governance, finance, management, and more.
Is CFNE a cooperative?
No, CFNE is a 501(c)3 not-for-profit organization. The board is from the cooperative community we serve.
How do I apply for a loan?
Please contact us; either call our office at 1-800-818-7833 or email us at email@example.com. We will put you in touch with a Loan Outreach Officer to discuss your organization’s needs and assist you with completing our application, which can be downloaded here.
How long does it take?
It depends. At a minimum, our process usually includes a site visit from one of our Loan Outreach Officers, getting to know one another and the sharing of a lot of information. When no real estate is involved, we generally estimate 6-8 weeks from completing the application to approval to closing to funding. The more complexity, the more time that is needed.
What are your rates and terms?
Terms can be from one to 10 years with monthly payments calculated on longer periods, and our interest rates are at or below market for small business loans.
Do we need collateral?
Almost always, yes, though we accept a wide range of collateral, including business assets, inventory, real estate, equipment, accounts or grants receivables, and guarantees.
How do I support CFNE?
You can make a social investment loan or a charitable donation to CFNE. You can also refer others to CFNE as borrowers or investors, and you can support CFNE’s borrowers by shopping at their stores and using their services.
How can I donate to CFNE?
We welcome donations! We run our operation on the margin of our loans – the difference between the interest we pay investors and the interest we charge from borrowers. Donations support CFNE’s ability to innovate and offer technical assistance to the co-ops we work with. We are a nonprofit, so your donations are tax deductible in most cases.
Donate by clicking here.
How can I become a CFNE social investor?
Find out all about social investments at CFNE by clicking here.
What makes CFNE different from a bank?
First and foremost, we are mission-driven to grow co-ops, we are not profit-driven.
If you are a borrower, our difference will show up in our flexibility to tailor our loans to meet the needs of co-ops. We do not face the same regulatory environment that banks do. We are bound by our tax-exempt status as a non-profit and by our U.S. Treasury certification as a Community Development Financial Institution.
For our investors the difference is that social investment loans are not insured by any government agencies (like the FDIC), but one should look at our fund’s history. Since our founding in 1975, no investor has lost any money.
What is a Community Development Financial Institution (CDFI)?
A CDFI can be one of any number of financial institutions. The primary mission of CDFIs is to promote economic development in struggling areas, both urban and rural, that are underserved by traditional financial institutions. CDFIs are playing a critical role in building a healthier economy by providing these communities with the access to capital that they so sorely need. CDFIs can be credit unions, community loan funds (like CFNE), venture capital funds or community development banks. There are more than 500 CDFIs in the United States, with at least one in every state.
What is the Cooperative Capital Fund of New England (CCF)?
CCF, a CFNE affiliate non-profit, provides long term equity-like funds to augment CFNE loans. CCF is currently inactive.