ABA, Trade Groups Urge Support for CDFI Funding Increase

The American Bankers Association and five other trade groups today urged House and Senate appropriations leaders to support $1 billion in funding for the Community Development Financial Institutions Fund in fiscal year 2022, with $100 million allocated for the Bank Enterprise Award Program.

The groups noted that an increase in funding is warranted “and it is justified by the significant demand, over subscription of the program, and dire need of the nation as we recover from the COVID-19 health and economic crisis.” They added that the proposed $330 million in budget proposals released by the Biden administration is only “a modest increase which does not begin to meet the needs of the underserved communities it supports.”

“The $1 billion request represents a modest 0.47% of total CDFI industry assets. This capital, however, is critically important at this time,” the letter said. “The monies will leverage up to 12 times the $1 billion in private capital (or $12 billion) that will be channeled to local businesses, nonprofits, and others to help vulnerable communities recover from the devastating effects of the recession and begin rebuilding.”