WASHINGTON — The Treasury Department is investing $9 billion into community development financial Institutions and minority depository institutions as a part of a new program to help communities that are struggling through the COVID-19 pandemic.
Treasury announced Thursday that it opened applications for its Emergency Capital Investment Program for CDFIs and MDIs in order to ensure that minority-owned businesses and low-income consumers have access to financial products. The program was established by the Consolidated Appropriations Act of 2021.
“The Emergency Capital Investment Program will help these places that the financial sector hasn’t typically served well,” Treasury Secretary Janet Yellen said in a press release. “It will allow people to access capital, especially in communities of color and rural areas.”
Of the $9 billion directed to CDFIs and MDIs, the program will set aside $2 billion for institutions with assets of less than $500 million and an additional $2 billion for participants with assets of under $2 billion. The capital will be used to support loans, grants and forbearance for small and minority businesses as well as low-income consumers.
The program is part of a combined $12 billion investment by Treasury to support CDFIs and MDIs during the pandemic. In February, Treasury made $1.25 billion available for a CDFI rapid response program, enabling institutions to provide grants for a variety of needs during the pandemic.
In the summer, Treasury plans to open up a $1.75 billion program to support lending, grants or investment activity in low- and moderate-income communities and to minorities with significant capital or financial services needs.
