COMMUNITY DEVELOPMENT FINANCE

Rosenthal and Archer-Rosenthal highlight the unique circumstances faced by community development institutions over the past decade.

The authors have many years of experience in community development financial institutions—organizations such as community banks and credit unions that offer financial services to underprivileged and underserved communities. Rosenthal established the Office of Financial Empowerment at the U.S. Consumer Financial Protection Bureau in 2012, and consultant Archer-Rosenthal has worked with numerous CDFIs. The pair highlight the unique challenges faced by these organizations in recent years. President Donald Trump’s administrations, they point out, have been inhospitable toward such organizations, even pushing for their dissolution. The Covid-19 pandemic created a set of overlapping crises, they write, that deeply affected the CDFI industry. Simultaneously, they note, the killing of George Floyd in 2020 led to a cultural social-justice awakening that highlighted the significance of CDFIs, thus increasing the flow of private resources to these institutions. Moreover, they say, Covid-era resources led to an influx of $12 billion, with most coming from the Paycheck Protection Program, which provided massive federal subsidies to institutions in need. The authors describe CDFIs as financial “first responders” who helped secure communities’ financial stability during the pandemic. The authors also describe how CDFIs have weathered the storm of President Trump’s latest administration, which has worked to divest federal money from CDFIs as well as stop diversity, equity, and inclusion (DEI) efforts. Overall, this book will be a useful and tangible resource for readers heavily involved in the world of nonprofits, credit unions, and the like, featuring such elements as a history of the CDFI certification process and an exploration of CDFIs with environmentalist goals; it may also appeal to aficionados of financial-sector histories. Its usefulness to those outside these groups, however, will likely be limited. At its core, the work feels more like a long position paper than a book for a general readership; as such, the prose tends to be repetitive, with the same key concepts highlighted to the point of exhaustion for casual readers.

A detailed analysis of the tumultuous past decade for CDFIs, aimed at a narrow audience.