OFN Home
  • Our Work
    • What is a CDFI?
    • Key Priorities
      • Affordable Housing
      • Financial First Response
      • Climate Change & Resilience
      • Healthy Communities
      • Native Finance
      • Persistent Poverty
      • Economic Opportunity
      • Rural Development
      • Small Business
    • Impact Stories
    • Impact Data
  • Investing & Giving
    • Why Partner with CDFIs
    • Invest in CDFIs
    • Invest Through OFN
    • Investor Resources
  • Members
    • Join OFN
    • OFN Membership Eligibility
    • CDFI Connect Community
    • Take Action
  • Public Policy
    • Partnering with the Public Sector
    • U.S. Treasury CDFI Fund
    • Public Policy Priorities
    • Public Policy Communications
    • Take Action
  • Initiatives
    • Current Initiatives
    • Past Initiatives
  • About
    • About OFN
    • Mission & Vision
    • Our Team
    • OFN Board
    • OFN Training & Events
    • OFN Newsroom
    • Work With OFN
    • OFN Financials
    • Contact Us
  • Resources
    • Blog
    • CDFI Locator
    • CDFI Industry Job Bank
    • CDFI Resource Library

Quick Links

  • CDFI Locator
  • Blog
  • OFN Training & Events
  • Join
  • CDFI Connect Community
RGVMB
15th
May
2017
Brownsville, TX

Texas CDFI Creates Innovative New Loan Option for Lenders

May 15, 2017

Client: Various

Client Location: Brownsville, TX

CDFI: Rio Grande Valley Multibank

CDFI Service Area: TX

CDFI Services Provided: 

Financing and technical assistance

Financial and Social Impact

  • Ten mission-based lenders in Maryland, Illinois and Texas have integrated the Center’s Loan model
  • CLC estimates 15,000 loans have saved clients more than $7 million

Texas is one of the poorest states in the country; business is booming for predatory lenders. Payday, car title, and other high-cost, unscrupulous financing services make up a $6 billion-a-year industry that strips $1.5 billion in interest and fees from local economies. For consumers, the loans offer immediate financing when needed, but often trap borrowers in a cycle of debt.

“These payday lenders know they can make money here,” says Nick Mitchell-Bennett, Administrator for Rio Grande Valley Multibank (RGVMB), a CDFI based in Brownsville, Texas on the U.S./Mexico border. “Let’s set up shop in the poorest city in the poorest county in one of the poorest states in the country. That’s what they did. And Texas regulations make it easy for them to do so and to take advantage of people who need short term cash.”

RGVMB, a longtime mortgage lender in the Rio Grande Valley, recently became a consumer ally in combating predatory lenders when it launched Community Loan Center (CLC). The program provides easy-to-access loans that are designed with borrowers’ best interest in mind and to compete with harmful loans.

“Our partner nonprofit mortgage companies and nonprofit housing developers were seeing an uptick in payday and car title lending that was affecting buyers’ ability to apply for and be approved for a mortgage,” Nick explains. “We knew we had to do something about it.”

RGVMB and its partners spent 18 months discussing alternatives to predatory lenders. CLC was born from this effort.

The program offers employer-based, small-dollar, affordable loans using a franchise model, which has the ability to scale geographically. RGVMB is the leader in envisioning, piloting, and creating the innovative product and proprietary lending platform. The CDFI works with Texas Community Capital (TCC), an Austin-based nonprofit lending intermediary, to market CLC and recruit lenders in different markets. These lenders then enlist local employers, who integrate CLC into their payroll systems. Borrowers apply for the loan online and are approved or denied immediately. Loan payments are then deducted directly from paychecks.

Today, 10 mission-based lenders across three states—Texas, Indiana, and Maryland—offer CLC. More than 100 employers of different sizes include CLC and its optional financial counseling program in their benefits packages. In total, 15,000 CLC loans have saved 8,000 employees more than $7 million.

“What appealed to us about CLC is that it has financial guidance, sets a fixed rate, and is transparent to our employees,” says Charlie Cabler, City Manager of Brownsville, which employs 1,300 people. “More than 300 employees have borrowed from CLC. They appreciate knowing exactly what their payments are and when they will pay off the loan. It is a good benefit for the city and a good source of funds when employees have unexpected expenses, like a car repair or medical bill.” Without such a program, he says, “employees would struggle to find money or turn to predatory lenders.”

As CLC expands into new areas, more families will build stronger financial health and local economies will benefit from having local lenders offering responsible products.

Tags: Credit Building, Education, Mortgage, Predatory Loans, Technical Assistance, Workforce Development

Share post to Facebook
Share post to Twitter
Share post to LinkedIn

Opportunity Finance logo - whiteHome

  • About OFN
  • Contact Us
  • Blog
  • OFN Training & Events
  • Subscribe for Updates
  • News Room
  • CDFI Locator
  • Invest in CDFIs
  • CDFI Connect Community
  • CDFI Industry Job Bank
  • Work With OFN
  • Commitment to Fairness

Copyright © 2025 Opportunity Finance Network. All rights reserved.

  • Terms of Use
  • Privacy Policy
  • Sitemap
  • OFN’s Facebook Page
  • OFN’s Twitter Page
  • OFN’s LinkedIn Page
  • OFN’s Instagram Page
  • OFN’s Youtube Page