Six Baltimore-area community development financial and minority depository institutions are receiving more than $24.5 million in federal funding to lift up businesses in minority and underserved areas.
The institutions are local credit unions, loan funds or venture capital providers that focus on fledgling businesses in the communities where they are located.
“These community development, financial institutions, are a very good conduit for those small businesses and entrepreneurs that are often left behind by the more traditional banking system,” U.S. Sen. Chris Van Hollen (D-Md.) told WYPR.
The funds come from the Treasury Department’s Community Development Financial Institution Equitable Recovery Program, which is meting out funds to areas disproportionately harmed by the COVID-19 pandemic.
The organizations receiving funds are:
- Harbor Bankshares Corporation in Baltimore City – $6,197,097
- Baltimore Community Lending, Inc. in Baltimore City – $4,957,678
- Neighborhood Impact Investment Fund, Inc. in Baltimore City – $4,957,678
- Charter Schools Development Corporation in Hanover – $3,718,258
- Municipal Employees Credit Union of Baltimore, Incorporated dba MECU in Baltimore City – $3,718,258
- Neighborhood Housing Services of Baltimore, Inc. in Baltimore City – $1,122,087
Van Hollen said the institutions often have much more community knowledge compared to larger banking organizations, and therefore can better understand the communities and businesses in them.
“Sometimes the bigger banks don't have the time or the team that will actually work with small businesses to help them launch to get them through those really difficult early weeks when they're starting to fly and learning to fly,” he said. “These are really important systems at the grassroots level.”
Last fall, Maryland-area community development financial and minority depository institutions received $86 million in federal funding.
So far, the Community Development Financial Institution Equitable Recovery Program has awarded more than $1.7 billion in funds to local organizations.