Scale Your Community Finance Impact: CDFI Financial Assistance Awards

If your organization is a certified Community Development Financial Institution (CDFI) working to expand access to capital in underserved communities, the CDFI Fund’s Financial Assistance program provides federal funding to scale your lending and services. These competitive awards provide capital—as grants, loans, equity, or other financial products—that you can deploy to increase lending for small businesses, affordable housing, community facilities, and other community development purposes in low-income markets.

The CDFI Financial Assistance (FA) program recognizes that mission-driven lenders serving underserved markets often struggle to raise sufficient capital to meet demand. Banks and investors may view these markets as too risky, leaving legitimate financing needs unmet. FA awards provide patient, flexible capital that allows CDFIs to take on more lending risk, reach deeper into underserved communities, and build the scale needed to become financially sustainable.

This isn’t free money with no strings attached. FA requires dollar-for-dollar matching funds from non-federal sources, and you must use the capital specifically to expand affordable financial products and services in your target market. But for CDFIs ready to grow their impact, FA can be transformational—allowing a jump in lending volume, expansion into new product areas, or serving markets you couldn’t previously reach.

Understanding CDFI Financial Assistance

The CDFI Fund offers two main award types through this program, plus a supplemental healthy food financing component.

Financial Assistance (FA) Awards

These are the core awards providing capital to CDFIs for lending and investment. FA takes several forms:

• Grants - Most common; provides capital that doesn’t need to be repaid
• Loans - Below-market interest loans to the CDFI
• Equity investments - For CDFIs structured to receive equity
• Deposits - For CDFI banks and credit unions
• Credit union shares - For CDFI credit unions

Most applicants request grants because they provide the most flexible capital without repayment obligations. The form of FA depends on your organizational structure and what best fits your business model.

FA must be matched dollar-for-dollar with non-federal funds. If you receive a $500,000 grant, you must have secured $500,000 in matching funds from private sources, state/local government, or other non-federal sources. Match can include cash, loans, equity investments in your organization, or in some cases in-kind contributions.

Technical Assistance (TA) Grants

Separate from FA, TA grants help CDFIs build organizational capacity. These smaller grants (typically up to $100,000-$150,000) fund activities like strategic planning, financial management systems, staff training, technology infrastructure, or consultant services to strengthen operations.

Both Certified CDFIs and Emerging CDFIs (organizations working toward certification) can apply for TA. Emerging CDFIs must demonstrate a credible path to certification within three years of receiving TA.

Healthy Food Financing Initiative (HFFI) Supplemental FA

CDFIs selected for FA awards may also qualify for additional HFFI FA specifically to finance projects that increase access to healthy foods in underserved communities. This might include financing grocery stores, farmers markets, food hubs, or other enterprises bringing fresh, affordable food to food deserts.

At a Glance: Program Essentials

Who Can Apply

Eligibility requirements differentiate between FA and TA applications.

For Financial Assistance (FA): Certified CDFIs Only

To apply for FA, your organization must hold current CDFI certification from the Treasury CDFI Fund. Certification demonstrates that you meet specific criteria:

• Primary mission to serve one or more target markets (low-income communities, underserved populations)
• Predominant business of providing financial products (loans, investments, financial services)
• Accountability to your target market through representation on your board or advisory council
• Status as a legal entity that can enter into contracts
• Track record of serving your target market

If you’re not yet certified, you must first complete CDFI certification (a separate application process taking 6-12 months) before you can apply for FA.

For Technical Assistance (TA): Certified and Emerging CDFIs

TA is available to both Certified CDFIs and Emerging CDFIs. If you’re an Emerging CDFI (not yet certified but working toward it), you must demonstrate you can realistically achieve certification within three years of receiving TA. Your TA application must explain how the grant will help you reach certification requirements.

The Match Fund Requirement for FA

Finding dollar-for-dollar match is often the biggest hurdle for FA applicants. Your match can come from:

• Private investors or lenders
• State or local government grants or investments
• Corporate investments or program-related investments from foundations
• Bank Community Reinvestment Act (CRA) investments
• Equity investments in your CDFI
• Below-market loans to your CDFI (the concessionary value can count as match)

Match must be committed specifically to the activities described in your FA application. You can’t count general operating support or capital you already had. The CDFI Fund reviews match commitments carefully—letters of intent aren’t sufficient; you need binding commitments or already-secured funding.

Allowable Uses of FA Awards

FA capital must expand your ability to provide affordable financial products and services in your target market. Allowable uses include:

Lending Capital

Most CDFIs use FA primarily as lending capital to make more loans. This could be:

• Small business loans in low-income neighborhoods
• Affordable housing development or rehabilitation financing
• Microloans for entrepreneurs
• Commercial real estate loans for community facilities
• Consumer loans (if part of your CDFI’s mission)

The FA capital becomes part of your lending pool, allowing you to originate more loans than you otherwise could.

Loan Loss Reserves

You can use FA to establish or strengthen loan loss reserves, which allow you to take on higher-risk lending to very underserved borrowers or innovative products where loss rates might be higher. Strong reserves make it possible to serve borrowers traditional lenders won’t touch.

Credit Enhancements

FA can provide credit enhancements that help you leverage additional private capital. For example, using FA as a first-loss position can make other investors more willing to invest in your loan fund at better terms.

Capital for Financial Services

If your CDFI provides financial services beyond lending (like financial counseling, small business development services, or matched savings programs), FA can capitalize those activities as long as they’re directly connected to expanding access to affordable financial products in your target market.

HFFI-Specific Uses

If you receive HFFI supplemental FA, it must specifically finance healthy food access projects—grocery stores, food retailers, urban farms, food processing, and distribution enterprises serving underserved communities.

What FA Cannot Fund

FA cannot be used for:

• General operating expenses (rent, salaries, utilities unrelated to specific loan products)
• Fundraising costs
• Political activities or lobbying
• Activities outside your certified target market
• Purposes unrelated to expanding financial products and services

TA grants have different allowable uses focused on capacity building rather than lending capital.

The Application Process

Competing for CDFI Financial Assistance requires significant preparation and a strong application.

Step 1: Review the NOFA

The CDFI Fund releases an annual Notice of Funding Availability (typically in spring or early summer) announcing the competition. The NOFA specifies:

• Application deadlines
• Available funding amounts
• Scoring criteria and priorities
• Required documentation
• Special initiatives or set-asides (if any)

Read the entire NOFA carefully—requirements and priorities can change year to year.

Step 2: Assess Your Readiness

Before applying, honestly evaluate whether your CDFI is ready:

• Do you have your dollar-for-dollar match secured or very close?
• Is your CDFI certification current?
• Do you have audited financials?
• Can you articulate a clear, compelling plan for deploying FA funds?
• Do you have the capacity to track and report on use of FA?

If gaps exist, consider whether to address them before applying or wait for a future funding round.

Step 3: Develop Your Strategy

Decide how much FA to request and what you’ll do with it. Bigger isn’t always better—request what you can credibly deploy and match. Your application must demonstrate:

• Clear demand in your target market for the lending/services you’ll provide
• Realistic plan for how you’ll use FA
• Evidence you have the capacity to deploy funds effectively
• Strong match commitments
• Impact you’ll achieve (jobs created, housing units financed, businesses served, etc.)

Step 4: Prepare Application Materials

FA applications are submitted through the CDFI Fund’s online system and typically require:

• Detailed narrative describing your CDFI, target market, proposed use of FA, and expected impact
• Financial statements (audited)
• Business plan or strategic plan
• Documentation of match commitments
• Track record information showing past lending and impact
• Community accountability documentation
• Various certifications and assurances

Plan to spend 40-80 hours preparing a solid application, more if you haven’t applied before.

Step 5: Submit and Wait

Applications are submitted electronically by the NOFA deadline (usually no extensions). After submission, the CDFI Fund conducts a detailed review taking several months. Applications are scored competitively based on:

• Need in your target market
• Soundness of your business strategy
• Impact projections
• Your organizational capacity and track record
• Strength of match commitments
• Feasibility of your plans

Awards are typically announced in late fall or early winter.

Step 6: Award Acceptance and Implementation

If selected, you’ll negotiate a grant or loan agreement with the CDFI Fund. This process can take additional weeks or months. Once under agreement, you have a specified period (often 12-18 months for FA deployment, up to 36 months for TA activities) to deploy funds according to your approved plan.

You’ll submit regular reports showing how you’re using funds and what impact you’re achieving. Compliance with award terms is critical—the CDFI Fund can recapture funds if you don’t use them as approved.

Maximizing Your Chance of Success

Financial Assistance is highly competitive, with many more qualified applicants than available funding. To strengthen your application:

Secure Your Match Early

Don’t apply hoping to find match later. Have signed commitment letters or already-closed investments before you apply. Weak match is a common reason for denial or low scores.

Focus on Impact

The CDFI Fund wants to see meaningful change in underserved communities. Quantify your expected impact—how many jobs, housing units, businesses, or families will benefit from your FA? Use data and evidence, not vague statements.

Tell a Compelling Story

Your application isn’t just forms and numbers—it’s a narrative about why your target market needs your services, why you’re uniquely positioned to serve it, and how FA will amplify your impact. Make reviewers understand and care about your community and mission.

Show Realistic, Detailed Plans

Generic plans get low scores. Be specific: what types of loans, to which borrowers, at what terms, achieving what outcomes? Detailed, realistic plans demonstrate you’ve thought through how you’ll actually use FA.

Highlight Your Track Record

If you have a proven history of successful lending and community impact, make sure reviewers see it. Past performance is the best predictor of future success.

Align with Current Priorities

The NOFA often highlights priorities—maybe rural CDFIs, minority-owned CDFIs, specific types of lending, or particular geographies. If your proposal aligns with priorities, emphasize that connection.

Get Help If Needed

Many successful CDFIs work with consultants experienced in CDFI Fund applications. While not required, expert help can make the difference between a mediocre and an excellent application, especially for first-time applicants.

Frequently Asked Questions

Can startups or new organizations apply? Only if you’re already CDFI certified. Certification requires a track record of providing financial products, so very new organizations typically can’t yet meet certification requirements. Focus first on building your track record and achieving certification.

What if we can’t find full dollar-for-dollar match? Then you cannot receive an FA award. The match requirement is non-negotiable. Consider applying for less FA (making match easier to achieve), seeking TA instead (no match required), or waiting until you’ve raised sufficient match.

Can we reapply if we’re denied? Yes. Many eventually-successful applicants faced initial rejections. Use feedback from your declined application to strengthen a future application.

How flexible is use of FA after we’re awarded? Somewhat flexible, but changes require prior written approval from the CDFI Fund. If market conditions or your strategy changes, you can request amendments to your agreement, but you must demonstrate the changes still serve the approved purposes.

Can faith-based organizations apply? Yes, if they’re certified CDFIs. Many CDFIs are sponsored by faith-based organizations. As long as FA funds aren’t used for inherently religious activities and you serve your community without religious discrimination, faith-based CDFIs are eligible.

Does receiving FA help with future applications? Past FA recipients who successfully deployed funds and achieved impact are often stronger candidates for future awards, because the track record demonstrates capacity. However, each competition is independent.

Getting Started

If you’re a CDFI interested in Financial Assistance, take these steps:

Confirm Your CDFI Certification - Verify your certification is current. If not certified, start the certification process well before you plan to apply for FA.

Build Relationships with Potential Match Sources - Start conversations with banks, investors, foundations, and state/local government about potential investments or grants to serve as match. Many CDFIs spend a year or more lining up match before applying.

Review Past NOFAs - Look at previous years’ NOFA to understand typical requirements, priorities, and scoring. This helps you prepare even before the current year’s NOFA is released.

Connect with Experienced CDFIs - Talk to CDFIs that have won FA about their experience and lessons learned. The CDFI field is collaborative; many experienced CDFIs are willing to share insights.

Watch for the NOFA - Sign up for email alerts from the CDFI Fund so you’re notified immediately when the NOFA is released.

For more information about the CDFI Program and to access the NOFA when released, visit https://www.cdfifund.gov/programs-training/programs/cdfi-program

CDFI Financial Assistance exists to help mission-driven lenders reach underserved communities that mainstream finance ignores. If you’re a certified CDFI with a strong strategy, committed match partners, and readiness to scale your impact, competing for FA can provide the capital injection that takes your organization—and the communities you serve—to the next level.