Community Development

Part II

What is a Community Development Finance Institution (CDFI)?

CDFIs are sustainable, independent organisations which provide financial services with two aims: to generate social and financial returns. They supply capital and business support to individuals and organisations whose purpose is to create wealth in disadvantaged communities or under served markets.

The cdfa defines a CDFI as:

• Sustainable
• Independent
• Financial institution
• Providing capital and support to individuals or organisations
• To develop and create wealth in disadvantaged communities or under-served markets

What do they provide funds for?

• Working capital
• Bridging loans
• Property & equipment purchase
• Start up capital
• Business purchase
• Marketing campaigns
• Personal loans
• Home improvements
• Back to work loans

Some key statistics of the UK CDFI Sector

The following figures are taken from cdfa’s industry-wide research, Inside Out 2007 – The State of Community Development. The 2007 report shows that:

• Overall growth continues and growing organisations are doing so faster, diversifying more and adopting a focus on delivery at scale and increasing coverage.
• Community development finance has delivered a strong return on investment from the public, private and charitable sectors.

The 2007 report showed:

• CDFIs have financed 15,000 businesses and households and sustained and created 33,000 jobs.
• Growth is accelerating, with Community Development Finance Institution (CDFI) investment and loans at the end of March 2007 at £287 million, up from £181 million the previous year – a 59% growth.

Inside Out is the only report to provide data and commentary on what's really happening in the UK's community development finance sector.

For more information on this report and to order your copy click here।

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