Funding a Small Business in Missouri with Bad Credit by cry21048


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									                                                    CDFIs in Missouri
                 Community                        Development                           Financial                   Institutions
                       What are CDFIs?                    A Unique Federal Partner: The CDFI Fund
                 CDFIs are mission-driven financial       The US Treasury Department's CDFI Fund is an

                 institutions that provide financial      innovative federal agency created to support                  Number of CDFIs in
                 products and services to people          the growth of CDFIs and to build their capacity                    Missouri:
                 and communities underserved by
                 traditional financial institutions.
                                                          to greater expand the availability of credit,
                                                          investment capital and financial services in                       14
                                                          distressed urban and rural communities. The CDFI
                 More than 800 CDFIs have been            Fund administers a range of programs accessible
                 certified by the CDFI Fund in the        to CDFIs. Foremost is the Financial and Technical Total $ value of CDFI Fund awards
                 Department of Treasury. They             Assistance program, a competitive grant program         to Missouri organizations since
                 operate in low-wealth                    that provides capital to CDFIs to carry out their                    1996:
                 communities in all 50 states and         business plans. Since its first round of funding in
                 the District of Columbia. CDFIs can
                 be banks, credit unions, loan
                                                          1996, the CDFI Fund has made almost $770 million
                                                          in awards for the FA and TA Program. In total,            $7,207,977
                 funds, venture capital funds,            since its creation in 1994, the CDFI Fund has
                 community development                    awarded $1.13 billion to CDFIs, community
                 corporations or microenterprise          development organizations, and financial              New Markets Tax Credits awards to
                 loan funds. All are united in their      institutions through the CDFI Program, the Bank              Missouri since 2002:
                 primary mission of community             Enterprise Award (BEA) Program, and the Native
                 development.                             Initiatives. In addition, the CDFI Fund has allocated
                                                          $26 billion in tax credit authority to Community     $1,172,000,000
                 Why are CDFIs needed?                    Development Entities (CDEs) through the NMTC
                 CDFIs fill a vital niche in the          Visit for more information.
                 nation's financial services delivery
                 system, offering loan products and        Putting CDFI Fund Dollars to Work:
                 financial services to families or in
                 communities that are difficult for
                                                           Missouri CDFIs bring capital and credit to low-income communities
                 traditional financial institutions to
                 serve. They provide loans and
                 investments to support the                Verchell Mitchell, owner of Just Another Soul Winner Music, had
                 development of quality affordable         completed recording her first gospel music album, but lacked the
                 housing, finance businesses, and          capital to pay for the duplication. Great Rivers Community Capital, a
                 finance community facilities,             CDFI wholly owned by Justine Petersen, originated a micro-loan to the
                 including health centers, daycare         business and Ms. Mitchell had every CD on hand at the release. Great
                 and education facilities, all with        Rivers Community Capital combines small loans with credit building to

                                                                                                                                               bridge the gap
                 the level of technical assistance         assist its clients to improve their credit profiles and access mainstream
                 needed by their borrowers. CDFIs          financing. As borrowers repay their loans, payment history is reported
                 often serve “micro” borrowers and         to the major credit bureaus establishing a positive payment history.
                 offer a range of business                 Counselors work with borrowers on basic financial education,
                 assistance services to help them          budgeting, disputing credit report errors and settling old bad debt.
                 succeed. Through their lending            “Within three months I was able to obtain some other financing
                 and investing CDFIs create jobs           avenues because of the credit building services at Justine Petersen and
                 and build wealth for low income           it was awesome”, tells Ms. Mitchell. Great Rivers Community Capital
                 individuals. Many CDFIs also              has originated over 5,000 micro- and consumer loans and is planning
                 provide basic financial services to       significant expansion following a $1 million grant from the CDFI Fund in
                 the unbanked and products to              2009.
                 combat predatory lending in
                 addition to mortgage products for         Contact: Great Rivers Community Capital. 1023 N. Grand Blvd. St.
                 lower income borrowers. Those             Louis, MO 63106 (314) 533-2411.
                 services frequently incorporate
                 technical assistance and training
                 such as financial literacy and
                 education, housing or foreclosure
                 counseling and other types of
                                                         CDFI Coalition • •
                                                        CDFIs in Missouri
                     Where do CDFIs                     Dollars at Work in Missouri Communities
double bottom line
                     get their money?                   At the end of Fiscal Year 2008, CDFIs in Missouri had over $156 million in financing
                                                        outstanding. CDFI customers include businesses, affordable housing developers,
                     CDFIs are capitalized by a         community facilities, microenterprises (businesses with less than 5 employees), and
                     diverse group of investors, all    individuals (for basic checking and savings accounts and personal development loans to
                     attracted by CDFIs’ double         buy a home, purchase a used car or pay for an education).
                     bottom line. CDFIs combine
                     financial return with a social                                           CDFIs in Missouri
                     return. Investors include
                                                        Central Bancshares Of Kansas City, Inc.
                     individuals, religious
                                                        Kansas City
                     institutions, foundations,
                     corporations, federal and state
                                                        Central Bank of Kansas City
                     government, banks and thrifts,
                                                        Kansas City
                     non-depository financial
                     institutions (such as insurance
                     companies or mutual funds),
                                                        Choices Federal Credit Union
                     national intermediaries, credit
                                                        St. Louis
                     unions and others. The top
                     four investors in CDFIs are:
                                                        EDC Loan Corporation
                     n Individuals, primarily in the
                                                        Kansas City
                     form of savings and checking
                     accounts in community
                     development banks and credit
                                                        Gateway Bank of St. Louis
                     unions. Some wealthy “angel
                                                        St. Louis
                     investors” make equity
                     investments in venture capital
                                                        Great Rivers Community Capital
                                                        St. Louis
                     n Banks and Thrifts, mostly
                     mainstream institutions
                     making loans to loan funds for
                                                        Housing & Economic Development Finance Corporation
                     relending. They often receive
                                                        Kansas City
                     CRA credit for these activities.
                     n Non-depository financial
                                                        International Institute CDC
                     institutions, primarily finance
                                                        St. Louis
                     companies, but also insurance
                     companies and socially
                     responsible mutual funds. Most
                                                        Justine Petersen Housing & Reinvestment Corporation
                     make loans to loan funds for
                                                        St. Louis
                     n Corporations, mostly as
                     deposits in community
                     development banks.
                                                        Kansas City Metro Fund
                                                                                                                                                                  social return
                                                        Kansas City
                     Investment by the Federal
                                                        Kansas City Terminal/Guadalupe Center FCU
                     Government accounts for only
                                                        Kansas City
                     7% of all CDFI capital.
                     However, it is important to
                                                        St Louis Community Credit Union
                     note that oftentimes federal
                                                        St. Louis
                     money serves to attract
                     private resources.
                                                        St Margaret's Credit Union
                                                        St. Louis

                                                        Table Rock Federal Credit Union
                                                        Shell Knob
                                                         The CDFI Coalition is the unified national voice of community development financial institutions. Our mission is
                                                         to encourage fair access to financial resources for America's underserved people and communities.

                                                        CDFI Coalition • •

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