Community Development Financial Institutions: Invaluable Capital Partners in Low-income Rural Areas

2019 ◽  
Vol 51 (4) ◽  
pp. 275-282
Author(s):  
Jeffrey Mosley
Keyword(s):  
Community Development ◽  
Financial Institutions ◽  
Low Income ◽  
Rural Areas ◽  
Community Development Financial Institutions

scholarly journals Understanding Community Development Financial Institutions and their Impact in Low- and Moderate-Income Neighborhoods

2021 ◽  
Vol 15 (1) ◽  
pp. 001-152
Author(s):  
Keyword(s):  
Community Development ◽  
Financial Institutions ◽  
Affordable Housing ◽  
Low Income ◽  
The United States ◽  
Research Papers ◽  
Vulnerable Communities ◽  
History Of ◽  
Community Development Financial Institutions ◽  
Community Facilities

Community Development Financial Institutions (CDFIs) are mission-driven lenders that create economic opportunity for low-income communities and individuals throughout the United States. The history of CDFIs dates back to the 1970s. There are currently over 1,100 operating as banks, credit unions, nonprofit loan funds, and venture capital funds. CDFI financing leads to the creation of jobs, affordable housing, community facilities and more. This issue of the Community Development Innovation Review is a collection of research papers designed to expand our understanding of CDFIs and their impacts in vulnerable communities across the country.

scholarly journals Does the CDFI Fund Help Low-Income Borrowers?

2014 ◽  
pp. 1-4
Author(s):  
Kristle Romero Cortés
Keyword(s):  
Community Development ◽  
Financial Institutions ◽  
Low Income ◽  
The Us ◽  
Community Development Financial Institutions ◽  
Grant Money

The Treasury Department's CDFI Fund awards grants to community development financial institutions (CDFIs) that operate in low-income areas. Awards are intended to strengthen the institutions and increase the amount they lend to borrowers in those areas. This analysis of propriety data from the US Treasury shows that when CDFIs receive grant money, they put it to use as additional loans in impoverished and economically weak areas.

Investing in Gentrification: The Eligibility of Gentrifying Neighborhoods for Federal Place-Based Economic Investment in U.S. Cities

2021 ◽  
pp. 107808742110326
Author(s):  
Noli Brazil ◽  
Amanda Portier
Keyword(s):  
Community Development ◽  
Financial Institutions ◽  
Affordable Housing ◽  
Low Income ◽  
Business Development ◽  
Tax Credits ◽  
New Markets ◽  
Job Opportunities ◽  
The Relationship ◽  
Economic Improvement

Place-based policies commonly target disadvantaged neighborhoods for economic improvement, typically in the form of job opportunities, business development or affordable housing. To ensure that investment is channeled to truly distressed areas, place-based programs narrow the pool of eligible neighborhoods based on a set of socioeconomic criteria. The criteria, however, may not be targeting the places most in need. In this study, we examine the relationship between neighborhood gentrification status and 2018 eligibility for the New Markets Tax Credits, Opportunity Zones, Low Income Housing Tax Credits, and the Community Development Financial Institutions Program. We find that large percentages of gentrifying neighborhoods are eligible for each of the four programs, with many neighborhoods eligible for multiple programs. The Opportunity Zone program stands out, with the probability of eligibility nearly twice as high for gentrifying tracts than not-gentrifying tracts. We also found that the probability of eligibility increases with a greater percentage of adjacent neighborhoods experiencing gentrification.

scholarly journals A Legal Analysis of the Use of Innovative Technology in the Promotion of Financial Inclusion for Low-Income Earners in South Africa

2021 ◽  
Vol 24 ◽  
pp. 1-27
Author(s):  
Howard Chitimira ◽  
Phemelo Magau
Keyword(s):  
South Africa ◽  
Financial Institutions ◽  
Low Income ◽  
Rural Areas ◽  
Financial Services ◽  
Informal Settlements ◽  
Financial Inclusion ◽  
Innovative Technology ◽  
Financial Exclusion ◽  
The Government

The promotion of financial inclusion is important for the combating of financial exclusion in many countries, including South Africa. Nonetheless, most low-income earners living in rural areas and informal settlements are still struggling to gain access to basic financial products and financial services in South Africa. This status quo has been caused by a number of factors such as the absence of an adequate financial inclusion policy, the geographical remoteness of financial institutions to most low-income earners, rigid identity documentary requirements, a lack of access to reliable and affordable Internet connection by low-income earners living in informal settlements and rural areas, a lack of financial illiteracy, the high costs of financial services, unemployment and poverty, over-indebtedness, and cultural and psychological hindrances to low-income earners in South Africa. Consequently, these factors have somewhat limited the access to financial services offered by financial institutions to low-income earners living in rural areas and informal settlements. In many countries, including South Africa, the financial sector is relying on innovative technology, especially in banking institutions, to aid in the offering of financial services to their customers. It is against this background that this article discusses selected legal and related challenges affecting the regulation and use of innovative technology to promote financial inclusion for low-income earners in South Africa. The article further discusses possible measures that could be adopted by the government, financial institutions and other relevant regulatory bodies to promote the use of innovative technology to combat the financial exclusion of low-income earners in South Africa.

scholarly journals Issues and Challenges of Financial Inclusion Among Low-Income Earners In Rural Areas of Malaysia

2021 ◽  
Vol 8 (Special Issue) ◽  
pp. 277-299
Author(s):  
Salihah Sharizan ◽  
Nur Harena Redzuan ◽  
Romzie Rosman
Keyword(s):  
Financial Institutions ◽  
Low Income ◽  
Rural Areas ◽  
Financial Literacy ◽  
Financial Services ◽  
Financial Education ◽  
Financial Inclusion ◽  
Primary Data ◽  
Structured Interviews ◽  
Finance Industry

Financial inclusion (FI) appears to be one of the main global agendas as it is an essential way of reducing poverty and increasing the economic growth of a country. FI is the provision of financial services to all segments of society in a more convenient, quality, and affordable way. In this study, the authors analyzed the issues and challenges faced from the two perspectives of the Financial Institutions (FIs) and the rural B40 group concerning the way of pursuing the exclusive of FI. Primary data was collected by conducting semi-structured interviews with four expert bankers from the Financial Institutions (FIs) in Kuala Rompin, Pahang, and two representatives from the B40 customers in the rural areas of Pekan, Pahang, Malaysia. Based on the findings, barriers faced by the supply sides of the FIs include 1) high risk of cost and security, 2) barriers in communication and lack of financial education, and 3) lack of proof documents. The other challenges are 1) competition with the conventional institutions, 2) default risk due to non-payment, and 3) internet connection problem. On the demand side, the issues and challenges found include 1) lack of confidence, 2) lack of proof documents, 3) misuse of capital, and 4) lack of financial literacy. Henceforth, the findings have significant implications for the Islamic banking and finance industry in exploring the current barriers faced in delivering financial inclusion to the lower segment of the society in Malaysia.

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