During a live web-stream last week, the White House announced grants totaling $1.25 billion through the US Department of the Treasury’s Community Development Financial Institutions (CDFI) Fund and its Rapid Response Program (RRP). Locally, Greylock Federal Credit Union was awarded the maximum level of $1,826,265 in federal funds in this first round of a three-tier program designed to support economic recovery by increasing access to capital in this region.
“We are grateful and humbled to be entrusted with this $1.8 million on behalf of our members,” said Greylock President, CEO John L. Bissell. “We will be careful stewards of these funds to ensure the legislative intent and the RRP’s mission of local community recovery is upheld.”
Following the intent of the RRP to increase community-level lending capacity, Greylock will use this capital infusion to help stabilize local households and businesses affected by the pandemic. They will also leverage these funds to support wealth-building activities by increasing regional home ownership, supporting more small businesses, and designing new financial products like the New Road Loan. The New Road Loan program allows Greylock to make loans to credit-challenged members to get and maintain reliable transportation for the purposes of employment, safety and family stability.
“Greylock’s vision is to help our community thrive,” said Bissell. “These funds will allow us to further enhance our commitment to provide access to financial solutions that meet people where they are. The RRP allows us to keep the momentum going from our extensive pandemic response into the next phase, our region’s recovery.” Greylock recently released a Community Impact Report detailing the impact of financial solutions designed in response to community needs during the COVID-19 pandemic. The full report is available on their website.
According to data cited by Congresswoman Maxine Waters (D-CA), Chairwoman of the House Committee on Financial Services, minority groups are disproportionately affected by COVID-19 and use of these funds must address this disparity. To this point Bissell added, “we will seek to work collaboratively, listening openly to community partners and advisors, to direct up to $500,000 of these funds to benefit communities of color and immigrants within our region as part of our ongoing pledge to the four pillars of IDEA (inclusion, diversity, equity and accessibility.)” This is further explained at www.greylock.org/IDEA.
Greylock achieved CDFI certification in 2015 in order to further its commitment to close gaps and remove barriers to financial opportunities for underserved communities in the region. CDFI certification identifies mission-driven financial institutions that support access to basic financial services, affordable credit and investment capital for everyone in the community. In return for certification, the Treasury utilizes this nationwide network to infuse funds where they are most needed and can be quickly distributed into the community.
According to comments from Treasury Secretary Janet Yellen during the web-streamed event, every one dollar invested in CDFIs leverages twelve dollars of private investment. She went on to point out that 70% of all venture capital investing in the United States is distributed within only four major metropolitan areas. The CDFI network will deploy these funds more broadly.
Greylock received one of three Massachusetts awards granted west of Worcester and is one of two credit unions statewide to receive awards. The RRP is designed to deploy capital quickly through its network of CDFIs to help counter the economic impacts of COVID-19 in distressed and underserved communities.