Community Development Finance Comes in All Shapes and Sizes

 

Scale Finance: Industrial-Strength Social Impact Bonds for Mainstream Investors

Social Impact Bonds have demonstrated significant growth potential within their defined boundaries, but the standard model has not yet developed mainstream investment transactions to expand certified evidence-based programs (CEBPs) commensurate with unmet population needs. This new paper proposes an enhanced SIB model called “Scale Finance” in which asset owners and fund managers work with CEBP developers to expand these proprietary programs at their maximum feasible growth rates. If successful, Scale Finance would offer a financially self-sustaining way to effectively solve certain pervasive social problems we already know how to fix. Learn more about the promise of Scale Finance in our blog post from guest author Steven Goldberg.

A CDFI for the Arts

In this paper, Penelope Douglas and David Erickson build on the concept of creative placemaking and present a Community Development Financial Institution (CDFI) organized around art: CultureBank. Housed at Yerba Buena Center for the Arts, this nonprofit bank specializes in unleashing asset value in art collections and focuses on artists as borrowers, or Artist-Entrepreneurs. Read the full paper.

What about Fintech?

Financial technology (fintech) continues to change the dynamics of banking and how financial products and services are delivered to consumers. At the SF Fed, we’re analyzing fintech innovations and their impacts on financial institution supervision, community development, financial stability, payments, and other areas. Our goal is simple: to help facilitate responsible innovations while protecting consumers and ensuring the safety and soundness of banks. Our team of fintech analysts are available to help answer questions from fintech companies and banks to build an understanding of the financial regulatory environment so innovative ideas thrive. Learn more and meet the team

Refresh your Understanding of the CRA

Forty years ago, the Community Reinvestment Act (CRA) came into our lives. If you’re still trying to understand how to apply it toward meaningful change in communities, you’re not alone. To answer this need, staff from across the Federal Reserve System came together to develop a series of brief videos to explain why the CRA exists and how it works.

Stay Focused on Outcomes

Too often, funding systems incentivize a short-term focus on “outputs.” For example, a shelter is typically funded based on beds filled each night—rather than an “outcome” like the number of people who transition to permanent housing. What Matters: Investing in Results to Build Strong, Vibrant Communities, our new book published in partnership with Nonprofit Finance Fund, features essays by dozens of leaders, exploring the possibilities of an outcomes-based world. Visit investinresults.org to explore the book and watch recordings from our San Francisco launch event.