Letter From Minneapolis, Minnesota: Investing in the Muslim Community With Microloans

The city prides itself on working with those who are "un-bankable," and on evaluating loans based on individual stories instead of automated credit scores.
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Ilhan Omar campaigns on November 8th, 2016, in Minneapolis, Minnesota.

Ilhan Omar campaigns on November 8th, 2016, in Minneapolis, Minnesota.

In August of 2017, a middle-aged white woman walked up to Balqiis Hersi's Minneapolis boutique and started banging on the glass door. Hersi's shop is on Lake Street, a once-derelict avenue south of downtown that has, in the last few decades, been revived by the entrepreneurship of primarily immigrant business-owners. Hersi, 33, co-founded ZiZi Boutique in late 2016, and she didn't yet have a proper sign. But pasted on a front glass window—across from a display of headless mannequins in long skirts and jewel-splashed necklaces—was a giant decal with an oversized text logo for Original Royal Refugee, a clothing line launched by Hersi's brother, Mohamed Hersi. They fled Somalia with their mother and seven siblings in the early 1990s, on the brink of the country's civil war. Hersi was locking up for the night, so she was alone in the shop when the woman began yelling at the glass. Fuck you refugees. This is America! Go back to where you belong. Though Hersi had lived in the United States for 16 years, she sensed racism had ballooned since the presidential election. In June, dozens of protesters had gathered to "March Against Sharia" at the state capitol building in St. Paul.

"This is where I belong," Hersi told me later. "I'm a citizen and I don't know anywhere else but this." Her first job, her education, her wedding—they all happened in America. The woman's words were just another challenge that came with being a Muslim entrepreneur. So Hersi finished closing up, and went home. And the next morning, she came back.

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I first visited ZiZi Boutique a few days after the white woman had come by to shout. A chandelier resembling a crystallized sea anemone swung above the cash register, and the shop carried the fluorescent, white-walled gloss of fast-fashion stores like Zara and H&M. Prayer mats were available in the corner. Hersi was conscious of how different it looked from the more traditional clothing shop her mother operated just two blocks away. "Mine caters to every woman, every aspect of a woman," Hersi told me, taking a seat on a white shag rug draped over a wooden bench. "Different religions, backgrounds, everything. Like you can walk in and you can find pants to wear, tank-top to wear, at the same time a Muslim girl can come in and get anything she wants."

The shop wouldn't have been possible without Hersi's mother, Misbal Ahmed. Sharia law prohibits riba, the paying or earning of interest in financial transactions, so Ahmed—"Mama Misbal," as many in the community call her—secured loans for Hersi the traditional Somali way: collecting them interest-free from friends and family.

Ahmed had seen herself what a loan could do for a fledgling business-owner. A few years after arriving in America, she had applied for a loan from the African Development Center to build up her shop in the Karmel Mall, home to the largest collection of Somali businesses in the Twin Cities. She was granted an initial loan of $15,000, interest-free.

A version of this story originally appeared in the June/July 2018 issue of Pacific Standard. Subscribe now and get eight issues/year or purchase a single copy of the magazine.

A version of this story originally appeared in the June/July 2018 issue of Pacific Standard. Subscribe now and get eight issues/year or purchase a single copy of the magazine.

Since 2007, Minneapolis has offered sharia-compliant loans through its Alternative Financing Program, with the ADC as its lead lender. A decade later, the city is still the only one in America to invest in its Muslim community with this model of microloans. Nasibu Sareva, the Tanzanian-born executive director of the ADC, said the center prides itself on working with those who are "un-bankable," and on evaluating loans based on individual stories instead of automated credit scores.

Ahmed was one of the first tenants to claim space in the Karmel Mall's newer building, and since the mid-2000s, her shop has held a prime location in a central, terra-cotta-colored first-floor hallway, its door marked by a sign with her name and shop number: 122.

I first met Hersi there, as she helped her mother rifle through cardboard boxes of scarves for some visiting out-of-town clients. The scarves were from China, where the duo now travels a few times a year to design and order their seasonal collections. Ahmed's shop is small, with the floor-to-ceiling efficiency of a market stall and the bubbling chatter of a kitchen table. Ahmed deftly maneuvered a towering metal pole to hook a blazer near the ceiling, while family and friends bantered in a knit of Somali and English and helped the clients fill bag after bag of clothing. When the clients left, Ahmed sank into a chair behind a sewing machine, pocketing a roll of cash. It was the first time I had seen her sit down all night.

Ahmed was tired—"I never had one day off in my whole life," she told me—but she was doing her part to encourage new Somali business owners. "I explain to them how they are going to get the loan and how it helps," she said. "Those who we explain it to come and get it."

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The next time I went back to ZiZi Boutique it was February of 2018, and Republican former governor Tim Pawlenty had just held a donor meeting to assess support in a campaign for his old post. Years earlier, Pawlenty had made national headlines when he claimed through a spokesperson to have personally shut down a program offering sharia-compliant mortgages through a partnership that included the ADC and the Minnesota Housing Finance Agency. Some private institutions offered similar programs, but this had been the first time a state agency had stepped in—initially under his governorship. Pawlenty's political narrative seemed clear: He did not want to be seen as the type of guy associated with sharia-anything.

Meanwhile, at ZiZi, the window displays were filled with hand-cut paper snowflakes. Hersi was six months pregnant and trying to squeeze in one more trip to China before her second child was due. She had previously watched her older siblings net an ADC loan to expand a childcare business, and she and her husband, Mohamed Somajeeste, had just been approved for a loan of their own. They had applied with plans to open a restaurant in a nearby suburb, but after their prospective rental space fell through, they planned to talk with the ADC about channeling the funds toward ZiZi instead.

As Somajeeste saw it, without an organization like the ADC, many Muslim entrepreneurs were caught in a catch-22. "You're kind of like in between worlds, because you want to be sharia-compliant and all that, but at the same time you kind of want to go where you can get the money," he told me.

I asked Hersi what Muslims without access to Minnesota's unique loan program did to avoid interest rates. She shrugged.

"Maybe they do the same that I'm doing," she said, referring to the loan her mother had given her. "Maybe they don't have businesses."

Recently, an out-of-state friend had asked Somajeeste and Hersi about expanding ZiZi Boutique beyond Minnesota, but ADC loans were only applicable in-state, and without the possibility of that funding, expansion remained out of reach. In the last year, Nasibu Sareva said he had heard from a record number of local business owners with similar interests, all coming up against the same wall. Still, the couple was making do. In March, they held a two-day pop-up in Ohio, where they could reach out-of-state customers like the one I had first seen amassing scarves at Hersi's mother’s shop.

Later, scrolling through ZiZi Boutique's Instagram, I noticed an old post with a photo of a woman in a pearled pink dress and turban, a silver teardrop earring visible as she turned her head toward the camera. Below the photo there was a quote from African-American sprinter Wilma Rudolph: "I can't are two words that have never been in my vocabulary."

A version of this story originally appeared in the June/July 2018 issue of Pacific Standard. Subscribe now and get eight issues/year or purchase a single copy of the magazine.

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