What happens if you don’t have a bank account but need to cash a check, pay a bill or take out a loan? You might resort to a check cashing store or a payday lender, and end up paying exorbitant fees. To help consumers who don’t fit well in the mainstream banking system, Congress created community development banking in 1994.
Community development financial institutions (CDFIs) bolster local economies through accessible financial services. Some low-income families don’t have access to basic bank services that most people take for granted. They might be denied loans because their credit histories don’t meet the minimum requirements for scoring by the credit reporting agencies. CDFI banks and credit unions offer accessible savings and checking accounts with low fees and features like online banking, ATMs and bill pay.
| Jump ahead to the list of financial institutions by choosing a state | |||
| Alabama | Alaska | Arizona | Arkansas |
| California | Colorado | Connecticut | Delaware |
| District of Columbia | Florida | Georgia | Hawaii |
| Idaho | Illinois | Indiana | Iowa |
| Kansas | Kentucky | Louisiana | Maine |
| Maryland | Massachusetts | Michigan | Minnesota |
| Mississippi | Missouri | Montana | Nebraska |
| Nevada | New Hampshire | New Jersey | New Mexico |
| New York | North Carolina | North Dakota | Ohio |
| Oklahoma | Oregon | Pennsylvania | Rhode Island |
| South Carolina | South Dakota | Tennessee | Texas |
| Utah | Vermont | Virginia | Washington |
| West Virginia | Wisconsin | Wyoming | |
Spring Bank is one such institution. It has been operating for nearly a decade in low-income neighborhoods in New York City, which has an estimated 825,000 residents with no bank account. Some don’t use direct deposit or have trouble maintaining the minimum account balances that many banks require in order to avoid paying fees. Before Spring Bank opened, many residents with limited incomes had been relying on check cashers, rent-to-own stores, pawn shops and other high-cost alternatives to mainstream banks.
While anybody can open an account there, Spring Bank’s mission is focused on people who would otherwise be locked out of the financial system. CDFIs rely less on credit scores and more on developing long-term relationships with members of the community and helping them gain financial literacy, establish savings goals and build credit.
If you need to borrow $500 but can’t qualify for a conventional bank loan, for example, a payday lender might offer a loan at a predatory interest rate equivalent to 400% a year. At a CDFI bank like Spring Bank, someone lacking a strong conventional credit history might successfully apply for a loan at an 18% interest rate. Instead of having to have a minimum credit score, applicants can often use employment history or proof of income to establish their ability to repay the loan. That can save hundreds of dollars in interest compared with a payday loan.
Because they can obtain funding from U.S. Treasury grants, CDFIs are often able to offer low-cost mortgages for first-time homebuyers and accessible loans for small businesses. For those with poor credit, they can offer small credit-builder loans designed to help consumers establish a good track record of repayments and responsibly rebuild their credit. Extending credit throughout the community helps promote a stable and healthy local economy.
Consumers with no access to credit are disproportionately represented in low-income neighborhoods, but the problem is remarkably widespread. As of 2010, 26 million Americans were “credit invisible,” meaning they didn’t have any credit record at the credit bureaus that prepare credit reports and calculate scores, according to a recent report from the Consumer Financial Protection Bureau. An additional 19 million had credit records that the credit bureaus considered unscorable — because they were too brief to be scored, for example. Together, those groups add up to almost 20% of the adult population.
To find a CDFI bank or credit union in your area, check the state-by-state list below.
| ALABAMA | |
| Alabama Teachers Credit Union | Gadsden |
| Bank of York | York |
| Demopolis Federal Credit Union (334)289-4686 | Demopolis |
| First Bank of Linden | Linden |
| Five Star Credit Union | Dothan |
| NRS Community Development Federal Credit Union | Birmingham |
| Phenix Pride Federal Credit Union | Phenix City |
| Bank of Vernon | Vernon |
| Tuscaloosa Credit Union | Tuscaloosa |
| United Bank | Atmore |
| West Alabama Bank | Reform |
| ALASKA | |
| MAC Federal Credit Union | Fort Wainwright |
| Tongass Federal Credit Union | Ketchikan |
| ARIZONA | |
| First American Credit Union | Casa Grande |
| MariSol Federal Credit Union | Phoenix |
| Pyramid Federal Credit Union | Tucson |
| ARKANSAS | |
| Bank of Lake Village | Lake Village |
| FBT Bank & Mortgage | Fordyce |
| Southern Bancorp Bank | Arkadelphia |
| CALIFORNIA | |
| Atchison Village Credit Union (510) 233-3218 | Richmond |
| Bay Federal Credit Union | Capitola |
| Beneficial State Bank | Oakland |
| Broadway Federal Bank | Los Angeles |
| Community Bank of the Bay | Oakland |
| Community Commerce Bank | Claremont |
| Community Credit Union of Southern Humboldt | Garberville |
| Desert Valleys Federal Credit Union | Ridgecrest |
| Episcopal Community Federal Credit Union | Los Angeles |
| First Choice Bank | Cerritos |
| Gateway Bank | Oakland |
| Mendo Lake Credit Union | Ukiah |
| Mission National Bank | San Francisco |
| Mission Valley Bank | Sun Valley |
| Neighborhood National Bank | National City |
| Northeast Community Federal Credit Union | San Francisco |
| Pacoima Development Federal Credit Union | Pacoima |
| Pan American Bank | Los Angeles |
| ProAmerica Bank | Los Angeles |
| Santa Cruz Community Credit Union | Santa Cruz |
| SCE Federal Credit Union | Irwindale |
| Travis Credit Union | Vacaville |
| COLORADO | |
| First Southwest Bank | Alamosa |
| Native American Bank, N.A. | Denver |
| CONNECTICUT | |
| Seasons Federal Credit Union | Middletown |
| Start Community Bank | New Haven |
| DELAWARE | |
| Eagle One Federal Credit Union | Claymont |
| Sussex County Federal Credit Union | Seaford |
| DISTRICT OF COLUMBIA | |
| City First Bank of D.C. | Washington |
| District Government Employees Federal Credit Union | Washington |
| Government Printing Office Federal Credit Union | Washington |
| Industrial Bank | Washington |
| FLORIDA | |
| Baptist Health South Florida Federal Credit Union | Miami |
| Community Trust Federal Credit Union (407) 880-4300 | Apopka |
| Darden Credit Union | Orlando |
| Envision Credit Union | Tallahassee |
| Flag Credit Union | Tallahassee |
| GTE Federal Credit Union | Tampa |
| Innovations FCU | Panama City |
| JetStream Federal Credit Union | Miami Lakes |
| Manatee Community Federal Credit Union | Bradenton |
| Suncoast Credit Union | Tampa |
| Tampa Bay Federal Credit Union | Tampa |
| TMH Federal Credit Union | Tallahassee |
| GEORGIA | |
| Carver State Bank | Savannah |
| Citizens Trust Bank | Atlanta |
| CORE Credit Union | Statesboro |
| Georgia Coastal Federal Credit Union | Brunswick |
| HAWAII | |
| Big Island Federal Credit Union | Hilo |
| Hawaii Federal Credit Union | Honolulu |
| Hawaii First Federal Credit Union | Kamuela |
| Independent Employers Group FCU | Hilo |
| Molokai Community Federal Credit Union | Kaunakakai |
| Prince Kuhio Federal Credit Union | Honolulu |
| The Queen’s Federal Credit Union | Honolulu |
| West Oahu Community FCU | Waianae |
| IDAHO | |
| Latah Federal Credit Union | Moscow |
| ILLINOIS | |
| Community Plus Federal Credit Union | Rantoul |
| CTA C&M Federal Credit Union | Oak Park |
| First Eagle Bank | Chicago |
| Fox Valley Credit Union | Aurora |
| IH Mississippi Valley Credit Union | Moline |
| Illinois Service Federal Savings and Loan Association | Chicago |
| International Bank of Chicago | Stone Park |
| Israel Methcomm FCU (773) 483-0096 | Chicago |
| Members First Credit Union | Quincy |
| North Side Community Federal Credit Union | Chicago |
| Pacific Global Bank | Chicago |
| Pan American Bank | Melrose Park |
| Park Manor Christian Church Credit Union | Chicago |
| Seaway Bank & Trust Company | Chicago |
| South Side Community Federal Credit Union | Chicago |
| Urban Partnership Bank | Chicago |
| INDIANA | |
| Mount Zion Federal Credit Union | Indianapolis |
| Natco Credit Union | Richmond |
| Regional Federal Credit Union | Hammond |
| Sterling United Federal Credit Union | Evansville |
| Union Baptist Church Federal Credit Union (260) 456-1802 | Fort Wayne |
| IOWA | |
| None | |
| KANSAS | |
| CBW Bank | Weir |
| EquiShare Credit Union | Wichita |
| KENTUCKY | |
| Metro Bank | Louisville |
| MAINE | |
| NorState Federal Credit Union | Madawaska |
| MARYLAND | |
| Harbor Bank of Maryland | Baltimore |
| MECU of Baltimore | Baltimore |
| Securityplus Federal Credit Union | Baltimore |
| MASSACHUSETTS | |
| Athol Credit Union | Athol |
| Greylock Federal Credit Union | Pittsfield |
| OneUnited Bank | Boston |
| MICHIGAN | |
| Alpena Community Credit Union | Alpena |
| CASE Credit Union | Lansing |
| Communicating Arts Credit Union | Detroit |
| Community Choice Credit Union | Farmington Hills |
| Community Promise Federal Credit Union | Kalamazoo |
| Credit Union ONE | Ferndale |
| First Independence Bank | Detroit |
| FM Financial Credit Union | Flint |
| Frankenmuth Credit Union | Frankenmuth |
| OMNI Community Credit Union | Battle Creek |
| Public Service Credit Union | Romulus |
| Settlers Federal Credit Union | Bruce Crossing |
| Shore to Shore Community Federal Credit Union | Trenton |
| Straits Area Federal Credit Union | Cheboygan |
| MINNESOTA | |
| Hermantown Federal Credit Union | Hermantown |
| North Star Credit Union | Cook |
| Sunrise Banks | St. Paul |
| White Earth Reservation Federal Credit Union | Mahnomen |
| MISSOURI | |
| Holy Rosary Credit Union | Kansas City |
| Horizon Credit Union | Macon |
| Joplin Metro Credit Union | Joplin |
| KC Terminal Employees/Guadalupe Center FCU (816) 842-6473 | Kansas City |
| Mercy Credit Union | Springfield |
| Metro Credit Union | Springfield |
| Mid Missouri Credit Union | Fort Leonard Wood |
| Missouri Central Credit Union | Lee’s Summit |
| Northeast Regional Credit Union | Hannibal |
| Ozark Federal Credit Union | Poplar Bluff |
| River Region Credit Union | Jefferson City |
| Riverways Federal Credit Union | Rolla |
| South Central Missouri Credit Union | Willow Springs |
| St. Luke’s Credit Union | Kansas City |
| St. Louis Community Credit Union | St. Louis |
| UBC Credit Union | St. Louis |
| United Consumers Credit Union | Independence |
| United Credit Union | Mexico |
| MONTANA | |
| McCone County Federal Credit Union | Circle |
| Missoula Federal Credit Union | Missoula |
| Mountain West Federal Credit Union | Butte |
| Wolf Point Federal Credit Union | Wolf Point |
| NEBRASKA | |
| None | |
| NEVADA | |
| None | |
| NEW HAMPSHIRE | |
| None | |
| NEW JERSEY | |
| New Community Federal Credit Union | Newark |
| North Jersey Federal Credit Union | Totowa |
| Renaissance Community Development Credit Union | Somerset |
| NEW MEXICO | |
| Guadalupe Credit Union | Santa Fe |
| High Plains Federal Credit Union | Clovis |
| Rio Grande Credit Union | Albuquerque |
| NEW YORK | |
| Fidelis Federal Credit Union (212) 234-4121 | New York |
| First American International Bank | Brooklyn |
| Genesee Co-Op Federal Credit Union | Rochester |
| Lexington Ave Federal Credit Union | Rochester |
| Love Gospel Assembly Federal Credit Union | Bronx |
| Lower East Side People’s Federal Credit Union | New York |
| Neighborhood Trust Federal Credit Union | New York |
| New York University Federal Credit Union | New York |
| Queens Cluster Federal Credit Union (718) 983-1796 | Hicksville |
| Quontic Bank | Astoria |
| Savoy Bank | New York |
| Southern Chautauqua Federal Credit Union | Lakewood |
| Spring Bank | Bronx |
| Syracuse Cooperative Federal Credit Union | Syracuse |
| NORTH CAROLINA | |
| First Legacy Community Credit Union | Charlotte |
| Greater Kinston Credit Union | Kinston |
| Latino Community Credit Union | Durham |
| Local Government Federal Credit Union | Raleigh |
| M&F Bank | Durham |
| Self-Help Credit Union | Durham |
| Self-Help Federal Credit Union | Durham |
| Vision Financial FCU | Durham |
| NORTH DAKOTA | |
| None | |
| OHIO | |
| Nueva Esperanza Community Credit Union (419) 720-9530 | Toledo |
| Toledo Urban Federal Credit Union | Toledo |
| OKLAHOMA | |
| Bank2 | Oklahoma City |
| Bank of Cherokee County | Tahlequah |
| Focus Federal Credit Union | Oklahoma City |
| My Choice Federal Credit Union | Tulsa |
| Security State Bank | Wewoka |
| OREGON | |
| Albina Community Bank | Portland |
| Cascade Community Federal Credit Union | Roseburg |
| Cutting Edge Federal Credit Union | Milwaukie |
| Maps Credit Union | Salem |
| Mid Oregon Federal Credit Union | Bend |
| Pacific Crest Federal Credit Union | Klamath Falls |
| Point West Credit Union | Portland |
| SELCO Community Credit Union | Eugene |
| PENNSYLVANIA | |
| Noah Bank | Elkins Park |
| Parkview Community Federal Credit Union | McKeesport |
| United Bank of Philadelphia | Philadelphia |
| RHODE ISLAND | |
| None | |
| SOUTH CAROLINA | |
| Carolina Foothills Federal Credit Union | Spartanburg |
| CommunityWorks Federal Credit Union | Greenville |
| Greater Abbeville Federal Credit Union | Abbeville |
| Greenville Heritage Federal Credit Union | Greenville |
| Health Facilities Federal Credit Union | Florence |
| SC Telco Federal Credit Union | Greenville |
| SAFE Federal Credit Union | Sumter |
| Security Federal Bank | Aiken |
| South Carolina Community Bank | Columbia |
| SOUTH DAKOTA | |
| Dakota Plains Federal Credit Union | Lemmon |
| Lakota Federal Credit Union | Kyle |
| Sentinel Federal Credit Union | Rapid City |
| TENNESSEE | |
| Appalachian Community Federal Credit Union | Gray |
| Bradley Initiative Credit Union | Cleveland |
| Citizens Savings Bank and Trust | Nashville |
| First Kingsport Credit Union | Kingsport |
| Orion Federal Credit Union | Memphis |
| Tri-State Bank of Memphis | Memphis |
| Trust Federal Credit Union | Chattanooga |
| US Community Credit Union | Nashville |
| TEXAS | |
| Associated Credit Union of Texas | League City |
| Border Federal Credit Union | Del Rio |
| Caprock Federal Credit Union | Lamesa |
| Coastal Community FCU | Galveston |
| First Light Federal Credit Union | El Paso |
| GECU | El Paso |
| Golden Bank | Houston |
| Houston Metropolitan Federal Credit Union | Houston |
| Kerr County Federal Credit Union | Kerrville |
| Kingsville Community Federal Credit Union | Kingsville |
| One Source Federal Credit Union | El Paso |
| Promise Credit Union | Houston |
| River City Federal Credit Union | San Antonio |
| Select Federal Credit Union | San Antonio |
| Southwest 66 Credit Union | Odessa |
| UTAH | |
| Provo Postal Credit Union | Provo |
| VERMONT | |
| Northern Lights Credit Union | St. Johnsbury |
| Opportunities Credit Union | Winooski |
| VIRGINIA | |
| DuPont Community Credit Union | Waynesboro |
| Fairfax County Federal Credit Union | Fairfax |
| First State Bank | Danville |
| Freedom First Federal Credit Union | Roanoke |
| Halifax County Community Federal Credit Union | South Boston |
| Virginia Community Capital | Christiansburg |
| Virginia Credit Union | Richmond |
| Virginia State University Federal Credit Union | Ettrick |
| WASHINGTON | |
| CALCOE Federal Credit Union | Yakima |
| Express Credit Union | Seattle |
| Industrial Credit Union | Bellingham |
| Lighthouse Community Credit Union | Vancouver |
| Lower Valley Credit Union | Sunnyside |
| Newrizons Federal Credit Union | Hoquiam |
| North Coast Credit Union | Bellingham |
| Peninsula Credit Union | Shelton |
| TULIP Cooperative Credit Union | Olympia |
| WEST VIRGINIA | |
| Northern Hancock Bank & Trust | Newell |
| The United Federal Credit Union | Morgantown |
| WISCONSIN | |
| Brewery Credit Union | Milwaukee |
| CoVantage Credit Union | Antigo |
| Mitchell Bank | Milwaukee |
| North Milwaukee State Bank | Milwaukee |
| Royal Credit Union | Eau Claire |
| WYOMING | |
| None | |
Jeanne Lee is a staff writer at NerdWallet, a personal finance website. Email: jlee@nerdwallet.com. Twitter: @jlee_jeanne.
Image via iStock.
from NerdWallet Credit Card Blog
http://www.nerdwallet.com/blog/banking/what-is-community-development-financial-institution/
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