Federal companies might enhance the efficiency of neighborhood financial investment programs by eliminating barriers to bank involvement in federal loan programs, enhancing public awareness of loan programs, and boosting the capability of neighborhood advancement banks to supply capital to low- and moderate-income neighborhoods and underserved populations, the American Bankers Association stated Monday in a letter to the Interagency Community Investment Committee.
The ICIC was produced by President Joe Biden previously this year as part of a bigger push by the administration to speed up financial chances in traditionally underserved neighborhoods. The committee provided an ask for input in October on methods to enhance neighborhood financial investment programs. In its letter, ABA made numerous suggestions based upon input from ABA members. One suggestion: if federal companies wished to motivate bank involvement in federal loan programs, they need to increase the assurance that the companies supply and lower the charges charged on loans to underserved people, companies and neighborhoods, the association stated.
ABA likewise advised companies help with the layering of public, personal, and humanitarian capital to increase job success, keeping in mind neighborhood advancement efforts frequently need numerous sources of funding. It recommended that federal companies increase awareness of federal programs and assistance for technical help; enhance and declutter procedures, treatments and programs; and develop on the successes of the CDFI public-partnership design. In addition, ABA prompted companies to take advantage of existing company information to lessen the problem on non-profit companies and prevent chilling neighborhood bank involvement in federal loan programs.