Frequently Asked Questions
Community Development Financial Institutions (CDFIs) are community-based specialized financial institutions that serve low income people or businesses in economically distressed communities, often working in market niches that may be underserved by traditional financial institutions. CDFIs provide a wide range of financial products and services that help customers build wealth and achieve the goal of participating in the ownership society.
The types of products may be similar to those provided by larger, mainstream financial institutions such as mortgage financing for low income or first time homebuyers, small business lending and lending for community facilities. CDFIs generally lend to and make equity investments in markets not served by traditional financial institutions. CDFIs may offer more flexible rates and terms and provide services that will help insure that credit is used effectively. CDFIs include regulated institutions such as community development banks and credit unions, and non-regulated institutions such as loan funds and venture capital funds.
What New York State CDFIs Do
Create market-based solutions that provide capital to chronically underserved New York communities
Leverage federal and private dollars for economic development
Are locally controlled and accountable to their target market
Provide financial services and education for low income New Yorkers
Promote responsible alternatives to predatory loans
The New York State CDFI Coalition (“Coalition”) formed in 1995 as a project of the National Federation of Community Development Credit Unions under Cliff Rosenthal’s leadership. In addition to Rosenthal, members of the original steering committee were Clara Miller (Nonprofit Finance Fund) and Lyndon Comstock (Community Capital Bank). Initial support from the Robert Sterling Clark Foundation launched the Coalition. Cathie Mahon (current Executive Director of the Federation) was hired as the first Coordinator. The steering committee was soon expanded to include leaders from Alternatives Federal Credit Union (Ithaca), Rural Opportunities, now Pathstone (Rochester) and Capital District Community Loan Fund (Albany).
The Coalition’s initial CDFI legislation, first proposed before the federal CDFI Fund existed, was passed in 2007-2008 with support from Democrats and Republicans alike.
In 2014 the Federation convened the Coalition’s ad hoc Steering Committee to jointly devise a long-term vision for an independent, sustainable entity to lead CDFI state-level advocacy, foster and develop collaboration, raise capital, and devise a communication strategy to raise awareness of the work of CDFIs in our state’s distressed communities. A Strategic Plan was developed and adopted in 2015, and a founding board was convened to move forward with incorporation and identified initiatives. MaryBeth Bunge was hired as Coordinator on a part-time consulting basis in September, 2015.
The ultimate goal of the coalition is to efficiently and effectively serve all people in New York State who require capital to achieve their financial goals and needs and communities that need to develop comprehensively to become good places to live and work. The Coalition will:
Provide a consistent voice as the advocate for CDFIs and their missions in NYS State
Develop strategies that serve the Coalition’s mission
Be accountable to the Coalition’s membership to achieve goals and serve the mission and vision
Connect NYS CDFI goals to the collaborative vision via regional subcommittees and innovative technologies for efficiencies and scale in lending.
The Coalition has already created an informal collaborative framework to advance community development finance throughout the state. The Coalition is the largest and most active such coalition of CDFIs in the nation, a recognized partner of state agencies with longstanding support from the state legislature and successive governors. The Coalition currently represents the interests of the state’s 70+ CDFIs. The Coalition monitors and participates in national policy and priorities affecting CDFIs.