WASHINGTON – The Obama administration has asked Congress for an almost doubling in funds for its Community Development Financial Institutions and to create a new segment that will focus on financial education, broader access to bank accounts and basic credit products.
The new segment, to be called Bank on USA, would dedicate $50 million to build on and supplement community-based efforts involving state and local governments, non-profits, and CDFIs, according to plans unveiled during congressional testimony yesterday by Michael Barr, the Treasury’s assistant secretary for financial institutions.
Testifying after Barr, William Bynum, president of the Enterprise Corporation of the Delta and Hope CU, called on Congress to expand funding for CDFIs, many of which are hurting for capital, he said.
Credit unions have become one of the main beneficiaries of the CDFI program, having been awarded more than $75 million in grants and loans since the inception of the program. The Obama administration has requested $250 million to fund the CDFI program this year. The proposal includes $12 million of funding targeted for projects in Native American areas.
The proposal also would fund a new multi-agency effort, the Healthy Food Financing Initiative, that will provide financing to increase the availability of affordable, healthy foods in underserved urban and rural communities.
