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Community Scope

Volume 4, Issue 1 2016

Demand and Capacity

Key Findings

There is strong demand for the products and services provided by CDFIs. Respondent CDFIs are working to meet this demand, but are restricted in their capacity by limited financial and staffing resources.

  • 70.2 percent of 124 respondent CDFIs experienced an increase in demand for their products and services in 2014. 82.3 percent of 124 respondent CDFIs anticipate an increase in demand for their products and services in 2016.
  • 66.9 percent of 121 respondent CDFIs aspire to perform additional functions that are beyond their current capacity.
  • A lack of financial resources is the most frequently cited obstacle that prevents respondent CDFIs from performing functions to which they aspire.

The words most frequently used by respondents to describe functions that they aspire to perform include:

Figure 11: What prevents the CDFIs in the survey sample from performing functions that they aspire to do?

Source: Survey results from the Federal Reserve Bank of Richmond’s 2015 Survey of CDFIs in the Southeast.

Figure 12: In 2014, did respondent CDFIs receive more qualified and approved loan requests than they had funding available?

Source: Survey results from the Federal Reserve Bank of Richmond’s 2015 Survey of CDFIs in the Southeast.

Respondents had the opportunity to share the greatest challenges facing their CDFIs with regard to demand and capacity. These quotes are direct excerpts from their responses:

“Demand has increased, specifically from new businesses or individuals seeking to start a small business.… We have been unable to raise enough capital to provide the extensive training and technical assistance needed to prepare these individuals for business.”
-Community Development Loan Fund in Florida

“[We] would like to expand loan capital, but the cost of regulatory compliance means that [we] cannot compete with nonregulated financial institutions that do not bear the cost of compliance and so can offer more competitive loans.”
-Community Development Bank in Maryland

“Staffing challenges prevent our organization from marketing our loans more comprehensively throughout a rather extensive service area.”
-Community Development Loan Fund in Virginia

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