The Community Development Financial Institutions Fund is asking for public feedback to refine the criteria it should use to designate “minority lending institutions” as a subset of CDFIs. By statute, MLIs both direct the majority of their financial products to minority populations or communities and either hold minority depository institution status or otherwise “demonstrate accountability to Minority populations” (which encompass Native Americans, Alaska Natives, Asians, Blacks, Hispanics or Latinos, and Native Hawaiians or Pacific Islanders).
The MLI designation was created by a December 2020 federal spending bill as one factor for COVID-19-related funding for CDFIs. “Although no federal funding will be associated with an MLI designation at this time, the CDFI Fund seeks to implement the designation for those CDFIs that wish to be recognized for their high levels of service and accountability to Minority populations, as well as to identify barriers such CDFIs experience in providing access to capital,” the fund said.
Among other specific topics, the CDFI Fund sought feedback on: how to define majority-minority Census tracts; the window of time used to assess service in these tracts; how to count financial products delivered to non-minority-owned customers that serve individuals from racial and ethnic minorities; methods MLIs may use to demonstrate accountability to minority populations, including governing board, advisory board and executive staff representation; and the alignment of the MLI and Native CDFI designations. Comments are due Nov. 25.
