416 Community development credit unions are CDFI-certified, representing a third of the CDFI industry
Inclusiv is excited to share that there are a total of 416 community development financial institution (CDFI) credit unions in the mainland United States and Puerto Rico. This is the highest number of CDFI credit unions in history, and it represents a 25% growth from just a year ago. To obtain their certification, many of these newly certified credit unions received direct support from Inclusiv, the official credit union representative within the CDFI industry. The majority of CDFI-certified credit unions are Inclusiv members, a recognition of the work the network has done on behalf of all CDFI credit unions since the establishment of the CDFI Fund in 1994.
Many of these newly certified credit unions are minority designated credit unions or minority lenders, such as the financial cooperatives from Puerto Rico, which serve communities most impacted by the economic contraction caused by the pandemic.
For the first time, regulated CDFIs - that is, credit unions, banks, and depository institution holding companies - make up the majority of the CDFI industry, at 55%. Credit unions now represent a third of the CDFI industry, serving more than 16 million predominantly low income consumers and communities of color.
Community development credit unions (CDCUS) have been delivering targeted relief to communities in distress on a massive scale since they were founded. During the economic downturn following the COVID-19 pandemic, they served as financial first responders, filling in gaps in hardest hit communities and facilitating stimulus dollars to reach people and businesses that needed it the most. In acknowledgement of this role, particularly in connection with the billions of dollars in Paycheck Protection loans that CDCUs provided, Inclusiv worked with legislators to include an unprecedented $12 billion in funding to CDFI credit unions in the CARES Act from December 2020.
The CDFI certification has become an essential credential for credit unions that seek a larger role in the development of their communities. Inclusiv is committed to support CDCUs to lend deeper and expand access to affordable and responsible asset-building products in underserved communities. With support from CUNA Mutual Group, Inclusiv has helped expand the network of CDFI-certified credit unions by engaging industry partners in a year-long CDFI awareness campaign, providing technical assistance, training, guidance, and tools to interested credit unions.
As a result of Inclusiv's efforts, we saw a growing number of CDFI-certified credit unions raising and channeling funds back into the communities they serve. In June of this year, 244 credit unions received $403 million in Rapid Response Program awards, 13 credit unions received $2.8 million to scale up small dollar loans and another 94 credit unions received $11.7 million in Technical Assistance grants in September, and 66 credit unions received $39 million in Financial Assistance grants and 85 credit unions received over $2 billion from the Emergency Capital Investment Program (ECIP) in December. The millions of dollars allocated to credit unions this year have almost doubled the total amount our industry has received since the inception of the CDFI Fund in 1996. This historic amount of funding both affirms and furthers the barrier-breaking financial inclusion work that credit unions were founded to do and continue to exemplify in their communities.
Photo: Vice-President Kamala Harris announcing the Rapid Response Program awards, June 2021
"The Inclusiv mission of advancing people and communities historically underserved by the financial mainstream is achieved day-in and day-out by CDFI credit unions. We are incredibly proud of the number of credit unions who have sought and gained CDFI certification, with our support and that of partners such as CUNA Mutual Group, as well as policymakers. Community development credit unions can utilize their CDFI certification to build economic stability and prosperity in their communities, delivering safe, affordable, and accessible products and services to people who are traditionally underserved," said Cathie Mahon, Inclusiv's President and CEO.
"CUNA Mutual Group has been a long-time supporter of credit unions exploring the benefits of CDFI certification and we are proud to partner with Inclusiv in this area," said Christopher Roe, Senior Vice President, CUNA Mutual Group. "We had some expectation that Congress would expand the CDFI Fund and that more credit unions could benefit. Because of the leadership of Inclusiv and the hard work of many in the credit union system, the number of CDFI credit unions has grown significantly and it has been exciting to see historic levels of CDFI funding flow to these credit unions - strengthening the system and making a difference in people's lives."
"Prior to 2018, there were zero CDFI credit unions in Puerto Rico. Today, there are 65 CDFI-certified financial cooperatives, or cooperativas. Inclusiv is committed to our Puerto Rico network, and our efforts have helped to increase CDFI certification on the island as well as to raise awareness - and deliver tangible results - about its benefits. Cooperativas can leverage these resources to exponentially expand their crucial work: strengthen the financial lives of their members, grow the local economy with small business loans, and empower job growth," said Pablo DeFilippi, Inclusiv's Senior Vice President of Membership and Network Engagement. In recognition of the impact of cooperativas in Puerto Rico, Inclusiv's annual conference will be held in San Juan, Puerto Rico, on May 2-4, 2022.