Capital Collaboration: An In-Depth Look at the Community Investment System in Massachusetts Working Cities

This publication presents the work of the Capital & Collaboration Initiative, a cross-sector effort designed to increase the scale, efficiency and impact of investments in Massachusetts cities of more than 35,000 people (excluding Boston), characterized by below-median family income and above-average poverty rates, which have been termed "Working Cities" by the Federal Reserve Bank of Boston.In 2013, the Boston Fed launched the Working Cities Challenge, a competition designed to incentivize cross-sector leadership and collaboration to benefit low- and moderate-income residents in these cities.In 2015, the Fed launched Capital & Collaboration as a companion process, examining the delivery of capital for downtown revitalization, small business, and scattered-site residential development. The Fed convened a working group of stakeholders from institutions that provide capital and services to communities in the Working Cities. It then invited Kresge Foundation Senior Fellow Robin Hacke and Katie Grace of the Initiative for Responsible Development to work with these parties to examine the community investment system, drawing on a capital-absorption framework Hacke and Grace had developed and have applied in cities across the country

Collaborators or Competitors? Exploring the Relationships between Community Development Financial Institutions and Conventional Lenders in Small Business Finance

This study examines the nature of the interaction of banks and community development financial institutions (CDFIs) in small business lending. We examine the experience of six different CDFIs that vary by size, corporate structure, and market. We explore how they both collaborate and compete with regulated lenders, and how changes in local and national market dynamics affect their activities. Our case studies are not necessarily representative of the CDFI industry, but they offer insights on the factors that shape CDFIs' interactions with and responses to more mainstream institutions. Our findings are therefore more descriptive than prescriptive, although we offer suggestions for both CDFI practice and future research