The US Treasury CDFI Fund recently provided $1.25 billion in grants through its Rapid Response Program in response to the economic impact of COVID-19. CU Strategic Planning’s clients received nearly 10% of the congressional appropriation. But that’s not the end of the support for Certified Community Development Financial Institutions!
Another $1.75 billion in grants will become available from the CDFI Fund’s Emergency Support and Minority Lending Program this summer. That’s $1.75 billion to help CDFI-certified credit unions to unlock greater potential in their communities and demonstrate their relevance through increasing service to minority populations and communities historically underserved and underbanked.
“These are the people and the communities who’ve been hardest hit by the COVID-19 pandemic, through lost jobs or reduced hours,” CU Strategic Planning Co-Owner Mike Beall observed. “Credit unions’ historic work, and specifically CDFIs serving minority populations, distressed communities and underestimated people have earned the respect and funding to put America on a path to recovery. It was so gratifying to see Vice President Kamala Harris, Treasury Secretary Janet Yellen, Representative Maxine Waters and Senator Mark Warner announce the RRP grants right in front of the White House!”
Another upcoming piece of the CARES Act funding is the Emergency Support and Minority Lending Program, for which $1.75 billion will be granted to expand lending, grant making, or investment activity in LMI minority communities and to minorities who have significant unmet capital or financial services needs. Funding from this program will provide a combination of grant capital and technical assistance that target communities affected by the pandemic. Eligible participants include depository and non-depository CDFIs, including a $1.2 billion set-aside for a new category of CDFIs, “minority lending institutions.” Treasury expects to open this program by early summer 2021.
“Leveraging these grants can help CDFIs reserve the capital they need to have even more of an impact on minority communities that have been neglected by traditional financial services companies,” CU Strategic Planning Co-Owner Jamie Strayer added. “Credit unions couldn’t be more relevant than they are right now and using these grant funds as a resource is critical to maximizing financial inclusion.”
Ronaldo Hardy, CU Strategic Planning’s Chief Diversity & Inclusion Officer, shared his hope that credit unions leverage the funding to create more inclusive lending practices starting at the policy level, crafted with an increasingly diverse executive teams and boards. He is leading a DEI Certification program for many of the participating CDFI credit unions.