Community-development finance institutions (CDFI) convened last week at the Opportunity Finance Network Conference in the U.S capital.
Ahead of the conference, the Urban Institute, a D.C. think tank, released findings from a comprehensive analysis of capital deployed by the industry. The institutions — lenders required to make at least 60 percent of their loans available to low- and moderate-income neighborhoods — lent more than $34.3 billion between 2011 and 2015, roughly $6.8 billion a year.
Nearly two-thirds went to communities with at least one indicator of economic distress, such as unemployment rates of at least 10 percent. But the funding isn’t equally distributed. Half of U.S. counties saw CDFI lending of less $7 a year per eligible low-income borrower, while 10 percent received $114 per eligible borrower in loans.
The CDFI industry has grown dramatically since 1994 when the U.S. Treasury created the CDFI Fund to encourage banks, credit unions, loan funds and venture capital providers to invest in communities that others found too risky. More than 1,000 institutions with $136 billion in assets serve borrowers in all 50 states, Washington, D.C., Puerto Rico and Guam.
Oscar Perry Abello has a smart “state of the CDFI industry” piece over at NextCity.