CCLF is a Community Development Financial Institution (CDFI) and is in the community development business, lending its resources to help create communities that thrive. 2025 already has been a whirlwind for the community development industry. The industry has received a great deal of attention from people who may not know much about community development, so understanding what CDFIs are and their vital work to strengthen underserved communities is more important than ever.

Established by the Riegle Community Development and Regulatory Improvement Act of 1994, CDFIs are federally certified community lenders that are tasked with promoting equitable economic revitalization across the country. Certification is a rigorous process, overseen by the CDFI Fund within U.S. Department of Treasury. It requires applicants to demonstrate how their products and services best address existing barriers to fair access to financial services. CDFI designation is highly coveted by nonprofit organizations and sought after for partnerships with larger traditional lending institutions, government entities, and other community development organizations.

The strength of our industry is in the diversity of the services offered and the ability to tailor them to the communities CDFIs serve. CDFIs are loan funds, credit unions, banks, and venture capital funds and operate in all fifty states. CDFI lending supports the development of affordable housing and homeownership opportunities, accelerates entrepreneurship and small business growth, and catalyzes community-focused projects that wouldn’t otherwise get over the threshold, including daycare and educational centers, grocery stores, healthcare facilities, and even large community facilities that support things like historical site preservation and youth sports.

CDFIs often offer bespoke products and services to individuals, organizations, and businesses in under-resourced communities coupled with financial education, housing counseling, business coaching, and low-interest rate loans that increase economic potential and help build wealth that stays within the community.

From 2013-2022, CDFIs invested more than $250 billion in low wealth communities nationwide, with $6.5 billion coming into Illinois. CDFIs also have a leverage ratio of 8:1 on average, bringing in billions of additional dollars from private sources to deepen the impact in hard-to-reach areas.

CDFIs are strong and resilient organizations that can be counted on in a crisis. At the height of the COVID-19 pandemic when relief dollars weren’t flowing quickly enough to keep small businesses and community organizations afloat, the federal government looked to CDFIs to successfully manage $65.78 billion in capital and provide emergency lending in the neighborhoods that had been most deeply impacted.

CDFIs are adept at solving national problems with local solutions that empower those who have been traditionally ignored and discounted. Having the backing of the federal government allows CDFIs to take the risks necessary to create over 3.1 million jobs, develop nearly 750,000 units of affordable housing, and finance nearly 800,000 microenterprises and small businesses from 2005 to 2021. CDFIs are a crucial part of the equation to achieving a country where prosperity is a realistic possibility for all of its citizens.