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Community development financial institution

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A Community Development Financial Institution (CDFI), is a category of American financial institution, which provide credit, financial services, and other services to underserved markets or populations. A CDFI may take one of four different forms: bank (community development banks), credit union (community development credit unions - CDCUs), loan fund (community development loan funds - CDLFs, including microloan funds), or venture capital company (community development venture capital funds - CDVC).[1]

CDFIs are certified by the Community Development Financial Institutions Fund at the U.S. Department of the Treasury, which provides funds to CDFIs by a variety of programs. The CDFI fund and the legal concept of CDFIs were established by the Reigle Community Development and Regulatory Improvement Act of 1994. Broadly speaking, a CDFI is defined as a financial institution that: has a primary mission of community development, serves a target market, is a financing entity, also provides development services, remains accountable to its community, and is a nongovernment entity.


In 2006, there were approximately 1250 CDFIs, consisting of:[2]

  • More than 500 community development loan funds;
  • More than 350 community development banks;
  • More than 290 community development credit unions;
  • More than 80 community development venture capital funds.

Nationwide, over 1000 CDFIs serve economically distressed communities by providing credit, capital and financial services that are often unavailable from mainstream financial institutions. CDFIs have loaned and invested over billions in our nation’s most distressed communities. Even better, their loans and investments have leveraged billions more dollars from the private sector for development activities in low wealth communities across the nation.

While there are numerous organizations certified as CDFIs by the CDFI Fund, it is believed that there are thousands of financial institutions serving the needs of low-income people or communities in the U.S., but either have not applied for CDFI status or have otherwise not been able to fulfill all of the requirements for formal CDFI certification.


There are a number of trade associations and other resources applicable to the CDFI industry. For more information, see:


  1. The Four Sectors of the CDFI Industry, Opportunity Finance Network
  2. Industry Statistics, Opportunity Finance

External links