CDFI Loans More Than Doubled Since 2018

Loan originations by Community Development Financial Institutions (CDFIs) have more than doubled between 2018 and 2022.

CDFIs originated approximately $67 billion and sold in the region of $14 billion in loans for the year 2022, according to a report by the Federal Reserve Bank of New York.

The report examined the reasoning behind the current demand increase for CDFI loans and found CDFIs originated at least $67 billion and sold at least $14 billion in loans in 2022.

By comparison, at the end of 2018, $29 billion worth of CDFI loan materialized and $6 billion in loans was sold.

The report found that overall, the CDFI industry has grown to over $450 billion in total assets as of 2022, a $260 billion increase since 2018.

The CDFI industry includes banks, credit unions, and loan funds, which accounted for 25% of the total origination volume and nearly 75% of the sold loan volume in 2022.

As a core source of financial stability to underserved communities, CDFI growth is informative to the situations of many US residents, says the report said.

The report also found residential loans made up 90% of the total volume of all loans sold by CDFIs, with CDFIs originating accounting for $32 billion of residential loans in 2022, representing nearly half of the total volume of CDFI loan originations across all collateral types.

CDFI credit unions collectively originated the highest loan volume. For sales, CDFI banks and credit unions sold loans more frequently, but in terms of total volume sold, loan funds were the most active type of institution.