Community development financial institutions (CDFIs) provide credit and financial services to people and communities underserved by mainstream commercial banks and lenders. CDFIs encompass a range of nonprofit and for-profit entities including community development banks, community development credit unions, community development loan funds, community development venture capital funds, and microenterprise loan funds.
History

CDFIs play a critical role in building community wealth for several key reasons:
- They provide much needed capital and financial services to people and communities that typically are not served by traditional financial institutions. Reflecting this, such institutions are credited with investing billions of dollars in low-income areas.
- Loans made by CDFIs often enable community members to purchase their first home or start or grow a locally-based business, and assist nonprofit organizations to develop affordable housing, build community facilities, and launch or expand critical community programs.
- CDFIs have played a pioneering role in community wealth building. For example, the federal Healthy Food Financial Initiative began as an effort led by a Pennsylvania CDFI (The Reinvestment Fund or TRF). In New Hampshire, the New Hampshire Community Loan Fund pioneered lending to residents to create manufactured housing cooperatives, an effort that, with the support of CFED and the Ford Foundation, has since been expanded nationally.
Community-wealth.org houses an extensive collection of resources focused on CDFIs and their role in community wealth building. Below is a glimpse of the rich array of materials you will find as you explore our site:
Our Support Organizations section features major organizations working to advance the CDFI field across the nation. One such group is Opportunity Finance Network, a leading trade association in the industry. As of the end of 2011, Opportunity Finance Network members have placed more than $30 billion in financing in urban, rural, and Native communities, with cumulative net charge-off rates of less than 1.7 percent.
Our Best Practices section showcases exemplary CDFIs from across the country. For instance, one such organization is Boston Community Capital. Founded in 1985, Boston Community Capital is a CDFI that has invested more than $900 million in underserved communities. Its loans and investments are credited with building or preserving over 14,800 units of affordable housing, supporting childcare facilities serving over 9,800 children, and creating more than 4,000 jobs in low-income communities .
Key Facts & Figures
Number of government-certified CDFIs (2018) | 1,066* |
Assets under CDFI management (June 2016) | $150 billion* |
Funds invested in CDFIs through the federal CDFI Program since 1994 (December 2017) | > $2 billion* |
Number of businesses financed by CDFI Program Awardees (2017) | 12,500* |
Number of affordable housing units financed by CDFI Program Awardees (2016) | 27,900* |
Number of jobs created or maintained by OFN member CDFIs since 1996 (2016) | 1.2 million* |
Our Research Resources section highlights web-based resources focused on CDFIs. For example, the Chicago Federal Reserve’s Community & Economic Development Research Information Center (CEDRIC) website includes links to a wide range of publications, organizations, and databases focused on access to credit and related community and economic development issues.
Our Articles and Publications section includes links to a diverse selection of articles, reports, papers, and books focused on CDFIs. One such article is Who is Lending to Small Businesses? The Role of Community Banks (2011), which demonstrates that community banks are more responsive than their larger, national counterparts, providing significantly greater support for local small businesses, particularly during recessionary periods.
Our Toolbox features resources designed to help practitioners working in the CDFI field as well as people interested in making community-based investments. For instance, Green America’s Community Investment Guide describes for the general public the key characteristics of community investment vehicles and the community benefits of such investing.
And, lastly, our Policy Guide provides an overview of federal initiatives and programs that can help practitioners leverage resources and increase their impact. For example, the Community Development Financial Institutions (CDFI) Fund is an independent agency operating a range of programs that provide equity capital to CDFIs.