Unlocking Financial Equity through Community Development Finance Institutions (CDFIs)
At Do it Now Now (DiNN), we are committed to empowering Black and Global Majority-led charities and social enterprises through equitable access to finance. Our Blended Finance Programme, Big Business, is designed to tackle systemic financial barriers by combining funding with capacity-building support, enabling organisations to scale sustainably and deepen their impact. CDFIs are key partners in this mission, providing accessible, flexible funding options to organisations often overlooked by traditional banks. They complement DiNN’s vision of creating long-term financial resilience and growth for organisations rooted in underserved communities.
What Are CDFIs?
Community Development Finance Institutions (CDFIs) are financial organisations designed to provide fair and accessible funding to individuals, businesses, and non-profits that are unable to secure finance through traditional banks. CDFIs focus on empowering underserved communities by offering affordable loans, financial guidance, and business development support. Their mission is rooted in promoting economic inclusion and addressing inequalities, making them a vital resource for charities and social enterprises.
How Many CDFIs Are in England?
There are approximately 50 CDFIs operating in England, each with a distinct focus on supporting organisations and individuals who face barriers to accessing mainstream finance. These institutions vary in size and scope, from those specialising in small business loans to others focusing on housing, community projects, and social enterprises. Community Development Finance Institutions (CDFIs) are financial organisations designed to provide fair and accessible funding to individuals, businesses, and non-profits that are unable to secure finance through traditional banks. CDFIs focus on empowering underserved communities by offering affordable loans, financial guidance, and business development support. Their mission is rooted in promoting economic inclusion and addressing inequalities, making them a vital resource for charities and social enterprises.
A Brief History of CDFIs in the UK’s Black Community
CDFIs emerged in the UK in the late 1990s, influenced by models developed in the United States, where they were established to address racial and economic disparities. In the UK, CDFIs quickly became essential for providing capital to communities historically excluded from mainstream financial systems. For Black-led organisations, particularly charities and social enterprises, CDFIs have been a critical source of funding, enabling them to grow, deliver services, and create opportunities in areas facing systemic challenges.
Black and Global Majority-led organisations often operate in sectors that face heightened barriers to accessing traditional loans, including poor credit histories, lack of collateral, and systemic discrimination. CDFIs have stepped in to bridge this gap, offering tailored financial solutions that prioritise community impact over profit. Their role has been especially impactful in addressing issues such as unemployment, housing, and social inclusion within Black communities.
Why CDFIs Matter for Black and Global Majority-Led Organisations Today
For Black and Global Majority-led charities and social enterprises, CDFIs represent more than just a funding source—they are partners in development. These institutions provide:
Flexible Financing: Loans designed to accommodate organisations with irregular income streams or evolving needs.
Business Support: Practical advice on financial planning, governance, and scaling operations.
Capacity Building: Tools and resources to improve long-term sustainability and impact.
CDFIs typically have a higher risk appetite than traditional lenders, making them well-suited to work with organisations that may lack extensive financial histories or collateral. They evaluate applications based on impact potential and organisational sustainability, rather than rigid financial benchmarks. While their eligibility criteria vary, most CDFIs focus on applicants who demonstrate clear social or environmental objectives and a commitment to serving disadvantaged communities.
Eligibility Criteria for CDFIs
Organisations must operate in underserved areas or serve marginalised groups.
Applicants should demonstrate measurable social or environmental impact.
Businesses and charities must show viable plans for revenue generation and repayment capacity.
Startups and early-stage enterprises may need to outline growth strategies and operational sustainability.
CDFIs help organisations achieve financial stability without compromising their mission. By offering products like unsecured loans and social investment options, CDFIs enable charities and social enterprises to build capacity, fund growth, and expand their services into areas that need them most. For Black and Global Majority-led charities and social enterprises, CDFIs represent more than just a funding source—they are partners in development. These institutions provide:
Flexible Financing: Loans designed to accommodate organisations with irregular income streams or evolving needs.
Business Support: Practical advice on financial planning, governance, and scaling operations.
Capacity Building: Tools and resources to improve long-term sustainability and impact.
CDFIs help organisations achieve financial stability without compromising their mission. By offering products like unsecured loans and social investment options, CDFIs enable charities and social enterprises to build capacity, fund growth, and expand their services into areas that need them most.
How Black and Global Majority-Led Organisations Can Benefit
Access to capital through CDFIs allows these organisations to:
Scale Their Impact: Funding can support larger projects, increase service delivery, and improve infrastructure.
Enhance Sustainability: Flexible repayment structures and reinvestment in operations ensure long-term stability.
Empower Communities: Resources are often directed toward job creation, skills development, and improving community services.
Reduce Financial Barriers: By focusing on mission-driven outcomes, CDFIs assess organisations based on their impact rather than solely on financial performance.
Building Pathways to Equitable Growth
For Black and Global Majority-led charities and social enterprises, CDFIs offer an alternative to traditional finance, rooted in equity and inclusion. These institutions are instrumental in breaking down systemic barriers, enabling organisations to access the resources they need to grow and thrive. At Do it Now Now (DiNN), we recognise the transformative power of CDFIs and are committed to supporting organisations in navigating and accessing these vital funding sources.
Through initiatives like Big Business, our Blended Finance Programme, we provide the tools, training, and connections that organisations need to secure funding and build sustainable futures. Whether you’re just starting or looking to scale, CDFIs can be the key to unlocking your organisation’s potential and making lasting change in your community.
Unlocking Opportunity Through CDFIs
CDFIs have long served as champions for economic inclusion, particularly for Black and Global Majority-led organisations striving to overcome systemic barriers. By providing tailored financial products and capacity-building support, they empower organisations to scale their impact while staying true to their mission.
At DiNN, we are committed to helping organisations harness the opportunities that CDFIs provide. Whether you’re exploring funding options or need support to develop your capacity, we’re here to help you build a sustainable and impactful future. Let’s work together to unlock opportunities and drive meaningful change.
