Community Development Financial Institution (CDFI)
A mission-driven financial institution certified by the U.S. Treasury’s CDFI Fund that provides affordable financial products and services to underserved people, businesses, and communities that may have limited access to traditional financing. CDFIs can include banks, credit unions, loan funds, and venture capital funds. [fdic.gov], [congress.gov]
Credit Enhancement
A financial tool or mechanism that reduces risk for lenders or investors, making it easier to finance projects or borrowers that might not otherwise qualify. Examples include loan loss reserves, subordinated debt, guarantees, and insurance.
Ecosystem Coordination
The process of aligning and connecting stakeholders—including nonprofits, government agencies, financial institutions, businesses, and community organizations—to achieve shared goals and improve outcomes within a specific system, sector, or geographic area.
Guarantee
A legally binding commitment in which a third party agrees to repay a loan or fulfill an obligation if the primary borrower or obligated party fails to do so. Guarantees help reduce lender risk and attract investment.
Food Systems
The interconnected network of activities, resources, people, and institutions involved in producing, processing, distributing, consuming, and disposing of food. Food systems encompass all inputs and outputs involved in moving food from production to consumption.
Place-Based Investment Strategy
An investment approach that focuses resources within a specific geographic area—such as a neighborhood, city, or region—to address local economic, social, and environmental challenges while promoting equitable community development and long-term prosperity.
Community Reinvestment Act (CRA)
A federal law enacted in 1977 that encourages federally insured banks to help meet the credit needs of the communities they serve, particularly low- and moderate-income neighborhoods, consistent with safe and sound banking practices.
CDFI Bank
A federally insured bank that has been certified as a Community Development Financial Institution and maintains a primary mission of community development by providing financial services and credit in underserved communities.
CDFI Loan Fund
A non-depository CDFI that provides loans and other financing to individuals, businesses, nonprofits, and community development projects in underserved markets. Unlike banks, loan funds do not accept insured deposits and typically rely on grants, investments, and borrowed capital to support their lending activities.