Delivering Credit to Entrepreneurs of Color Impacted by COVID-19: Why CDFIs Are Essential

Prior to the global pandemic, the relatively high small business start and ownership rates among entrepreneurs of color were a bright spot in a period of declining US entrepreneurship. But small businesses have endured some of the hardest stresses of the pandemic, as forced closures and physical distancing have decimated earnings for restaurants, salons, childcare centers, and other services we all rely on. Businesses owned by entrepreneurs of color have been particularly impacted by declining revenues, and despite government efforts to get money into people’s hands, many small businesses have not received the support they need. This is partly a problem with the delivery systems used: programs that flow through banks miss those that have historically been underserved. Fortunately, there are lenders who serve these businesses and communities: Community Development Financial Institutions. CDFIs are mission-driven lenders that serve the parts of America that too often get left behind, including people of color, returning veterans, new citizens, and more. What role can CDFIs play in supporting entrepreneurs and advancing equity during this uncertain time? And how can policymakers, investors, philanthropy, and others support the work of CDFIs? This virtual event by the Aspen Institute Economic Opportunities Program explores the role CDFIs can play in supporting entrepreneurs and advancing equity during this uncertain time, as well as how can policymakers, investors, philanthropy, and others support the work of CDFIs. This conversation features Bill Bynum (HOPE); Michael Barr (Gerald R. Ford School of Public Policy); Nicole Jordan-Reed (Nicole Jordan Catering, LLC); and moderator Helaine Olen (The Washington Post).