WASHINGTON–The Senate Appropriations Committee is proposing to increase funding for the Community Development Financial Institutions Fund by $50 million more than the House has proposed.
In its draft of the FY 2026 Financial Services and General Government appropriations bill, the committee is proposing $324 million for the CDFI Fund. The draft, which has not yet gone to markup, allocates at least $188 million for Financial Assistance and Technical Assistance awards, $28 million for Native American initiatives, and $9 million for the Small Dollar Loan Program, according to CU Strategic Planning, which first reported on the funding.
As the CU Daily reported earlier, the House has proposed an allocation of $274 million for the CDFI Fund.
“With the Senate recommending a level consistent with FY 2025 funding, the outlook is positive for the Fund, its programs, and its capacity — and for credit unions preparing FA/TA applications or pursuing CDFI Certification,” said CU Strategic Planning in its statement. “For credit unions, this means planning for the next funding cycle can continue confidently. We see no signs of unusual restrictions, structural changes, or disruptions to core CDFI Fund programs.
Long Road Ahead
“The bill and accompanying report also recommend that Treasury ‘take into consideration the unique conditions, challenges, and scale of non-metropolitan and rural areas,’ and emphasize increased targeted investment in persistent-poverty counties — aligning with existing CDFI program priorities and the Administration’s stated interest in expanding support for rural CDFIs.” CU Strategic Planning continued.
The proposal must still be passed by the Senate and then would have to go through the reconciliation process. But the support for funding the CDFI Fund is significant given that the Trump administration has sought to eliminate the fund and later attempted to fire Treasury staff responsible for overseeing the fund.
DCUC Says Move is ‘Smart National Policy’
In a statement, the Defense Credit Union Council’s chief advocacy officer, Jason Stverak, said the Senate Appropriations Committee’s proposal is “not just good budgeting, it is smart national policy. DCUC applauds this investment as it directly strengthens the ability of credit unions, especially those serving our military and veteran communities, to deliver affordable capital, expand financial inclusion, and support the economic resilience of the communities we serve.”
In a statement, DCUC noted CDFI-certified credit unions have long been on the front lines of community development.
“They provide safe, responsible lending options, help families build credit, support small business growth, and offer life-changing financial counseling; services that are especially vital for service members, veterans, and families navigating frequent relocations, deployments, and economic uncertainty,” DCUC said.
Moreover, the Defense Council said the increased funding would empower credit unions to:
- Expand small-dollar and emergency loan programs that keep military families out of predatory traps;
- Invest in affordable housing initiatives near military installations where demand continues to outpace supply;
- Grow entrepreneurship programs for veteran-owned small businesses;
- Deploy more capital into underserved rural and urban defense communities often overlooked by traditional lenders.
‘Unmistakable ROI’
“At a time when military families continue to face rising costs, frequent PCS moves, and persistent predatory lending threats, strengthening the CDFI Fund is a direct investment in their financial readiness and overall well-being,” Stverak added.
DCUC further stated that is strongly urges Congress to maintain this funding level as the appropriations process moves forward. “The return on investment is unmistakable: stronger communities, stronger families, and a stronger nation,” the organization said.
