Opportunity Finance Network, the nation’s leading investment intermediary and network of community development financial institutions (CDFIs), has released a new research report on The Business Model of Loan Funds. This report examines the business model of CDFI loan funds and highlights the model’s key components, benefits, and tradeoffs.
CDFI loan funds are specialized lenders that offer fair, responsible financing and promote economic opportunity in rural, urban, and Native communities across all 50 states, as well as the District of Columbia, U.S. Virgin Islands, and Puerto Rico. They are highly effective and impactful, but not as well understood as other financial institutions.
With financing and coaching, these mission-driven lenders support affordable housing, community facilities, small businesses, and more elements of thriving communities. Their financing and tailored technical assistance enable wealth building and create jobs that help boost local economies.
The report identifies and examines four key components of the CDFI loan fund business model:
- Mission-driven lending
- Localized focus
- Development and capitalization
- Technical assistance
Click here to access the full report or a 2-page summary.
Florida Community Loan Fund is a CDFI Loan Fund with over $755 million in total financing deployed, resulting in projects totaling $2.25 billion in development costs and providing services annually for 2.3 million low-income Floridians. As a nonprofit, minority-controlled, multifaceted financing entity, FCLF has nearly 30 years of history providing flexible capital and expertise to nonprofit and mission-aligned for-profit entities to make projects successful and improve lives and communities. FCLF is nationally recognized for its work as a certified CDFI and CDE through the U.S. Dept. of Treasury and as a member of the Federal Home Loan Bank of Atlanta. For more information, visit fclf.org.
Florida Community Loan Fund is a member of the Opportunity Finance Network, OFN.org
