Nerd Wallet: What Is a Community Development Financial Institution?

October 13, 2015

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.

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