Financing Low-income Communities

Economic restructuring, the emergence of telecommunications and information technology, and other national and global trends have dramatically changed the environments in which community development takes place. Capital gaps have changed, capital itself is becoming more "de-localized," and the financial services industry has evolved entirely new ways to transact business and service customers. But whereas the mainstream financial world has changed enormously over the past several decades, Community Development Financial Institutions (CDFIs) by and large have not. This article discusses how the CDFI industry will need to re-engineer, reposition, and re-tool itself in order to remain an effective conduit for the flow of capital to low-income communities.

Thanks to Brookings Institution