6 Advantages of Working with a Community Development Financial Institution (CDFI) for Small Business Loans
As a small business owner, securing financing can be a major hurdle to overcome.
Traditional financial institutions often have strict requirements and may be hesitant to lend to small businesses with limited history or in underinvested communities.
That's where Community Development Financial Institutions (CDFIs) like AltCap come in.
CDFIs are mission-driven organizations that provide fair access to capital for communities and businesses that traditional financial institutions do not adequately serve. While they can take many forms, CDFIs share in the mission of helping promote economic opportunity for low- to moderate-income communities.
AltCap is a certified non-profit CDFI that focuses its mission on small business lending in low to moderate-income communities. We offer financing that allows us to invest in businesses and communities that traditional lenders do not serve with flexible, patient capital.
In this article, we'll explain what CDFIs are and how working with one can help your business and community grow. Here are just a few of the advantages of working with a CDFI like AltCap:
CDFIs offer Accessible Financing
CDFIs provide financing to entrepreneurs who might not otherwise have access to credit through traditional banks or financial institutions. This is especially true for individuals and communities that are historically underserved by mainstream finance. CDFIs are known for their flexible financing options, which can include term loans, lines of credit, and other types of financing tailored to meet the unique needs of small businesses. At AltCap, we offer small business loans and financing options for real estate development, equipment purchases, working capital, and more.
CDFIs are Focused on Fair and Responsible Lending
CDFIs are mission-driven and committed to providing fair and responsible lending to borrowers. CDFIs prioritize meeting the unique needs of the communities they serve and ensure that the terms of their loans are transparent and manageable for borrowers.
CDFIs Offer Personalized Support
CDFIs often provide personalized support alongside their financial products, such as financial education and business coaching. This helps entrepreneurs to develop the skills and knowledge they need to succeed — beyond just capital.
CDFIs are Flexibile with Financing Options
CDFIs are flexible in their lending practices, often accommodating borrowers who might not meet traditional collateral or underwriting requirements. This can be especially helpful for entrepreneurs who are just starting out or who have limited credit histories.
CDFIs Prioritize Local Impact
CDFIs prioritize investing in their local communities, helping to create jobs, building affordable housing, and supporting local businesses. By working with a CDFI, entrepreneurs can support economic development in their own communities while also accessing the financing they need to grow their businesses.
CDFIs Offer Supportive Partnerships
CDFIs often establish long-term relationships with their borrowers, providing ongoing support and financing as their businesses grow and develop. This can be especially helpful for entrepreneurs who need stable, reliable financing partners to help them navigate the ups and downs of running a business. CDFIs like AltCap also can connect you to their networks of entrepreneur support organizations that can provide additional support, such as business coaching, accounting, marketing, and more.
Overall, working with a CDFI can provide many advantages for entrepreneurs who need financing and the communities in which they work.
From access to fair and responsible lending to personalized support, CDFIs can help entrepreneurs to start and grow their businesses while also supporting economic development in their local communities.
Reach out to AltCap today if you’re interested in discussing financing options for your small business or real estate project.
