The U.S. Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) released today the application data for the fiscal year (FY) 2021 round of its Small Dollar Loan Program (SDL Program).
The SDL Program is a new program authorized by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Pub. L. 111-203) that is intended to expand consumer access to financial institutions by providing alternatives to high cost small dollar lending. Up to $13.5 million in awards is available through the FY 2021 round of the SDL Program, which is the first award round of the program. Through the SDL Program, the CDFI Fund will provide:
- Grants for Loan Loss Reserves (LLRs): The awards will enable a Certified Community Development Financial Institution (CDFI) to establish a loan loss reserve fund in order to defray the costs of establishing or maintaining a small dollar loan program.
- Grants for Technical Assistance (TA): The awards will support technology, staffing, and other eligible activities to enable a Certified CDFI to establish and maintain a small dollar loan program.
A total of 81 organizations submitted applications requesting nearly $26.3 million in funding, which is nearly two times the amount of funding available. Specifically:
- Five organizations requested nearly $1.6 million in LLR awards;
- 15 organizations requested $2.2 million in TA awards; and
- 61 organizations requested $22.5 million for a combination TA award and LLR award.
Per the Notice of Funds Availability (NOFA), eligible applicants may request up to: $150,000 for TA awards; $350,000 for LLR awards; and up to $500,000 in total for combination TA/LLR awards.
Of the 81 applications submitted by CDFIs, 43 were from loan funds, 26 were from credit unions, and 12 were from banks or bank holding companies. Nationwide, FY 2021 SDL Program applicants are headquartered in 35 states, the District of Columbia and Puerto Rico.
The FY 2021 application period closed on June 29, 2021. The CDFI Fund currently expects to announce the awards in September 2021. For more information about the SDL Program, visit the CDFI Fund’s website at www.cdfifund.gov/sdlp.