WASHINGTON (2/26/15)--Two independent reports released by the U.S. Treasury's Community Development Financial Institutions (CDFIs) Fund Wednesday show that CDFIs are as stable as mainstream lenders and meet their mission of serving the underserved.
According to the CDFI Fund, the reports are the first comparative analysis of the effectiveness of CDFIs compared with mainstream lenders.
CDFIs are specialized financial institutions working in markets that are underserved by traditional financial institutions. The CDFI Fund provides monetary awards and tax credit unions to CDFIs in order to promote access to capital and economic growth.
As of Jan. 31, credit unions make up 243 of 936 certified CDFIs.
The first report, from the Carsey School of Public Policy at the University of New Hampshire, is an analysis of the impact of financial assistance awards from the CDFI program on CDFI loan fund recipients.
The second report was conducted by individuals from Darden School of Business at the University of Virginia and the Stanford Graduate School of Business. It is an analysis of CDFI credit unions and banks, assessing stability and operational efficiency relative to mainstream financial institutions.