The building process began during Woo’s junior year. He proposed the name for the group after reading about the Jubilee concept in the Bible. According to the book of Leviticus, every 49th or 50th year, the Israelites observed the practice of freeing slaves and forgiving debts, which Woo saw as God granting a fresh start to correct imperfect social structures that lead to inequality and injustice.

Why then, borrowers have asked, does JIFFI charge an interest rate — and a rate of 21 percent? Woo said the group debated the rate and where to draw the line. One important factor was the desire to sustain the organization with funds for future borrowers. Another was a state law that caps the interest at 21 percent for non-professional groups. He pointed out that JIFFI’s effective rate is much lower, amounting to about $6 on a loan of $100. Ultimately, the decision came down to creating a business relationship.

“Charging [interest] is not done so much out of a desire to profit, but we are trying to serve our neighbors while maintaining their dignity,” Woo says. “A big part of it is treating our clients as equals and not just a person on the other end of a charitable donation.”

“We are trying to serve our neighbors while maintaining their dignity. A big part of it is treating our clients as equals and not just a person on the other end of a charitable donation.” Peter Woo, JIFFI founder

Woo and Bebar said they made plenty of mistakes early on and quickly learned from each one. They had to raise money and incorporate as a nonprofit, track expenses and file tax returns. They had to figure out how to create a full-time lending operation with students who spent much of their time in classes or studying, who normally left campus for semester breaks and summers, and who turned over completely every four years.

And they had to find clients, which didn’t happen until the following March. JIFFI had created slick marketing materials but didn’t have a plan to get them to potential clients. Handing out flyers in the snow in front of payday lender locations had failed.

“We thought that having a nice website and pamphlets would be what it took,” Woo says. “We focused too much on nonessentials, like hardware, and not what really mattered, which was the relationships with our local partners.”

Their first client came through Bonnie Bazata, director of Bridges Out of Poverty. Bazata was impressed by Woo’s ambition. In the past she’d seen numerous student groups with big hearts for serving others, but most lacked the ability to relate to people in need.

“What made Peter remarkable was that he could do both,” Bazata says. “He was brilliant at research and team building, but he was humble and could also connect with people across economic classes.”

Bazata pointed to the group’s uniform as an example. A white T-shirt with a colorful tie and pocket printed on the front offered the perfect mix of approachable and professional.

Bazata said Bridges works with people who often get caught in a debt spin cycle, going to one payday lender to cover the fees at another. Banks don’t see any value in this type of client, but predatory lenders understand their customer’s needs — they have late hours, storefronts within walking distance, no credit checks, and even toys to occupy the kids.

“There aren’t good options for the under-resourced,” Bazata says. “They’re caught between what one writer called ‘the devil and the deep blue sea.’ But JIFFI gives people hope that they can get out of the tunnel of scarcity.”

“There aren’t good options for the under-resourced,” Bazata says. “They’re caught between what one writer called ‘the devil and the deep blue sea.’ But JIFFI gives people hope that they can get out of the tunnel of scarcity.” Bonnie Bazata, director of Bridges Out of Poverty

Woo and Bebar also came to terms with the predatory lenders, who they say offer a necessary evil. They’re still against the exorbitant profits, but that passion was redirected into creating a better alternative with a focus on financial literacy and ultimate self-sufficiency.

Early on, JIFFI faced simple challenges like locating a meeting space. They chose to be an independent organization rather than a school club, so they ventured outside the campus bubble. They rent office space from the South Bend Heritage Foundation and organize carpools for those without cars. JIFFI members, called associates, pay $60 or $100 a year to foster commitment and pay for staff expenses.

The group’s first crowdfunding campaign reached out to family and friends, raising $8,500 in early 2014. That spring they made three loans. The following year, they made 10 more loans at an average of about $285, ranging in purpose from car repairs to job training and a new water heater to paying off payday loans.

Woo and Bebar also learned that constant communication with clients was crucial for the loans to be paid back. JIFFI now designates contacts during school breaks and hires one associate as a summer intern. “Clients not having a good experience was one of the things that held us back from expanding,” Woo said.

When Woo graduated, Bebar became the new leader. The group grew to 40 staff members, organized into departments, and made 16 loans the following school year. It expects to make 20 this year under new leader John Markwalter.

“I got to practice all the things I was being taught,” Woo reflects. “I think the greatest part about leaving with the organization still going is that my peers and friends will have that same opportunity. That’s the thing that makes me most satisfied, actually.”

JIFFI now faces a major decision about its future. State law limits unlicensed lenders to 25 loans per year. Securing a license costs $100,000 and requires hiring a full-time professional with experience.

Paulsen, the current board chair and social entrepreneurship expert who first advised Woo, said the group’s strong early leadership made remarkable progress. But student groups, like businesses, often fizzle if they don’t keep growing, so she said they might have to take the “next leap” in the future after they establish a steady track record.