Lack of access to capital, as well, as predatory lending and financial services holds our nation back — underserved communities can't move forward due to rampant inequities in the access to affordable, responsible finance.

Last month, at Opportunity Finance Network's annual conference, I delivered a state of the CDFI industry speech to an audience of more than 1,100 opportunity finance practitioners comprising credit unions, other CDFIs and their supporters. I asked everyone to reflect on how far they have come in expanding coverage and growing the opportunity finance movement in the 20 years since President Clinton signed into law the Riegle Community Development Act of 1994. Then, I challenged us to look honestly at how far we still need to go to realize equity among all communities — and what it will take to get us there.

Credit unions play an increasingly important role in creating equity in all underserved U.S. communities, from blighted urban neighborhood and rural banking deserts to Indian Country and disadvantaged suburbs. But together we want to do more. Low-income credit unions, in particular, play a special role in communities of color, which is where OFN believes we need to focus our work.

In an era when basic financial products and services are melting away from many communities that need them most, my organization is committed to increasing the capacity of all types of CDFIs — including credit unions — to meet pressing community needs.

When the Riegle Community Development Act went into effect 20 years ago, credit unions were poised to take a lead in delivering credit, services, and opportunities to low-income and low-wealth communities. While the CDFI Fund, which the act created, has exceeded expectations in most areas, it is only now starting to reach its potential in partnership with low-income credit unions.

We must do better.

The Challenges

One challenge was programmatic — the CDFI Fund focused more on lending than consumer products and services. Another was cultural — the CDFI Fund required a unique form of grant application unfamiliar to most credit unions. Finally, the CDFI Fund required matching funds for all CDFI Fund Awards. Though the fund allowed use of retained earnings as match, the requirement constrained credit union demand.

Today, slightly more than 10% of NCUA-designated low-income CUs are CDFI certified, and the fund has awarded just $185 million to Community Development CUs — or CDCUs — out of a total of almost $2 billion in total awards. Roughly 10% of OFN's 250-Member CDFI Network are CDCUs.

The balance of the CDFI industry — community development loan funds, community development banks, and community development venture funds — is eager to see more credit unions succeeding in the CDFI space.

Under a contract with the CDFI Fund, OFN is now working with the National Federation of Community Development Credit Unions to expand CDFI coverage — broadly defined — to communities that do not currently have access to the unique products and services CDCUs and other CDFIs provide.

This is the latest in a more than 25-year-old relationship with the Federation, but it's just part of our work to strengthen CUs. In 2007, OFN, Wells Fargo, and the John D. and Catherine T. MacArthur Foundation gave one of the first NEXT Awards for Opportunity Finance to the Latino Community Credit Union in Durham, N.C., to support its statewide expansion to better reach and serve Latino communities.

And last month, OFN awarded the industry's highest recognition, the Ned Gramlich Award for Responsible Finance, to Bill Bynum, CEO of the Jackson, Mississippi-based Hope Credit Union, for his pioneering work in reaching communities of need. Among the Award's earlier recipients was Cliff Rosenthal, former CEO of the Federation.

Reaching 'Opportunity Markets'

CDCUs reach what I like to call "opportunity markets" — the people and places outside the margins of the mainstream, often communities that have been systemically denied access to essential financial products and services. We have dual goals: To help those people and places gain access to the economic mainstream and to help mainstream institutions realize the potential of these opportunity markets.

OFN and our industry partners will continue to work to strengthen CDCUs' capacity, connecting them with other CDFIs, improving their access to the CDFI Fund and other government resources, and supporting them as they fill market gaps.

At the same time, there is strength in numbers. We encourage all eligible CDCUs to explore CDFI certification and learn more about the opportunity finance industry. The more CDCUs we welcome into the CDFI space, the better able credit unions will be to assume the critical role they are meant to play — creating opportunity. For all.

Why? Because equity.

Mark Pinsky is the president and CEO of Opportunity Finance Network. Visit for more information.