The proposed rescindment of the Community Reinvestment Act (CRA) final rule issued in October 2023 is a step backwards for community lending and access to capital for small businesses. The rule, which was the first update to the CRA since 1995, offered important modifications to bring the CRA into the modern era – including taking into account mobile and online banking, ensuring banks are assessed for areas in which they heavily operate, not only where they have physical branches.
As a landmark civil rights law passed in 1977, the CRA is one of the best tools our communities have to ensure capital flows to where it is most needed. Community development financial institutions (CDFIs) – and the small businesses they serve – count on the CRA to deliver investments in low- and moderate-income communities.
A modernized CRA is necessary to ensure our financial system works efficiently and fairly for all zip codes and communities. We respectfully encourage the Federal Deposit Insurance Corporation, Federal Reserve Board, and Office of the Comptroller of the Currency to reconsider rescindment of the October 2023 final rule.