WASHINGTON — Just 15 days ahead of a deadline to use the funds, the Treasury Department has announced long-delayed Community Development Financial Institutions Fund (CDFI) awards, releasing fiscal 2025 funding and moving ahead with a portion of fiscal 2026 awards just two weeks before authority to use some of the money was set to expire.
The awards include funding through the fiscal 2025 Community Development Financial Institutions Program and Native American CDFI Assistance Program, along with fiscal 2026 awards through the Bank Enterprise Award and Small Dollar Loan programs.
Treasury Secretary Scott Bessent said the awards are intended to increase investment and economic opportunity in underserved communities while ensuring oversight of the federal funding.
Bessent said Treasury will oversee the funding to ensure it supports investment in low-income and distressed communities, local economic growth and expanded economic opportunity.
As the CU Daily has been reporting, the announcement resolves, at least in part, months of uncertainty surrounding nearly $300 million in fiscal 2025 CDFI Fund appropriations that had not been awarded.
Treasury announced approximately $289 million in stalled CDFI awards and said recipients will be notified by Sept. 30. The spending authority for the fiscal 2025 money was scheduled to expire at the end of the month if the funds were not obligated.
America’s CUs Welcomes Announcement
“We appreciate Treasury Secretary Bessent and CDFI Fund Director Chris Miller awarding the remaining FY 2025 and a portion of FY 2026 funding ahead of the September 30 deadline,” said America’s Credit Unions President and CEO Scott Simpson in a statement. “America’s Credit Unions urged Treasury to act on this issue so that credit unions can serve their local communities, helping their members with small business financing, home loans, and affordable consumer credit in low-income, rural, and underserved neighborhoods. Releasing these funds gives our institutions the certainty they need to keep capital flowing to families and local businesses that have been left behind by banks.”
Funds Had Been Delayed
As the CU Daily has been reporting, the CDFI Coalition reported earlier this year that the Office of Management and Budget apportioned $289 million in fiscal 2025 CDFI Fund appropriations in April, but awards had not been made.
At that time, funding remained outstanding for several programs, including Financial Assistance and Native Initiatives. The coalition also said the fiscal 2025 funding authority would expire Sept. 30, 2026.
The Trump administration has repeatedly attempted to eliminate the fund and/or Treasury staff responsible for managing it, only to have Congress return the funds.
The delay had prompted growing pressure from CDFIs and their advocates.
Inclusive Action for the City, a Los Angeles-based CDFI, and CAMEO Network filed a federal lawsuit in August seeking to force the administration to release the money before the appropriations expired, according to Next City.
The stakes were particularly high because CDFIs use the federal awards to leverage additional private capital for small-business loans, affordable housing, community facilities and other investments in underserved areas.
From fiscal 2010 through 2024, CDFI Fund Financial Assistance recipients originated nearly $300 billion in loans and investments in distressed and underserved communities, including more than $55.8 billion in financing for more than 1.34 million businesses, according to Treasury data cited by Next City.
Some FY 2026 Money Also Awarded
Treasury’s announcement also moves forward a portion of the CDFI Fund’s fiscal 2026 appropriations.
Congress provided $324 million for the CDFI Fund for fiscal 2026, the same overall funding level as fiscal 2025. The appropriation includes at least $188 million for CDFI financial and technical assistance, $28 million for programs serving Native American, Native Hawaiian and Alaska Native communities, $40 million for the Bank Enterprise Award Program and $9 million for the Small Dollar Loan Program.
The CDFI Fund opened the fiscal 2026 Bank Enterprise Award and Small Dollar Loan program application rounds June 30. The Bank Enterprise Award Program had $40 million available and was expected to make approximately 180 awards.
The Small Dollar Loan Program is intended to help financial institutions provide alternatives to higher-cost small-dollar credit.
For ‘Main Street America’
CDFI Fund Director Chris Miller, who took over the agency in August, said the newly announced awards are intended to translate federal funding into economic activity in local communities.
“The CDFI Fund’s programs are designed to support economic growth and prosperity for Main Street America,” Miller said.
He said the funding will help small businesses expand and create jobs, help consumers build credit and savings and help families pursue homeownership and other economic opportunities.
Credit Unions Among CDFIs
Credit unions are among the banks, loan funds, venture capital funds and other financial institutions eligible for CDFI certification and assistance.
There are about 1,300 federally certified CDFIs operating across all 50 states, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands, approximately 450 of which are credit unions. To qualify, institutions must have a primary mission of community development and direct at least 60% of their lending or other financial services toward qualifying low- and moderate-income markets or populations.
Credit union advocates had pressed Treasury to release the delayed funding and provide a more predictable timetable for future awards.
The release of the fiscal 2025 money comes just 15 days before the Sept. 30 expiration of the government’s authority to use those appropriations.
