CDFI Code of Practice

What is the CDFA?

We represent community development finance institutions (CDFIs). CDFIs provide loans and support to people who find it difficult to access finance from the commercial banks.

As a trade association, we do not offer loans, funding or financial advice to the public ourselves. However one of our members may be able to help you. The best way to find out about CDFA members operating in your area is to go to our dedicated website www.findingfinance.org.uk.

CDFIs are sustainable, independent financial institutions that provide capital and support to enable individuals or organisations to develop and create wealth in disadvantaged communities or under-served markets. 

 

Ten Standards of compliance with the CDFI Code of Practice

 

1. Clarity in respect of loan interest rates, repayments, default and cancellation arrangements.

2. Customer awareness that the CDFI adheres to these ten standards within the Code of Practice, in a customer-facing document published on the website.

3. Legal Compliance - the CDFI will comply with all relevant laws, regulations and the requirements of its regulators, including the timely submission of accounts and returns.

4. Clear financial processes - the CDFI will adhere to financial approval and decision making processes, operate a well-managed portfolio, and its Board will monitor the finances of the CDFI.

5. Accountability by the Board - the Board will always act in the best interests of the CDFI, representing its shareholders and/or members, and reporting back to them.

6. Management of Risk - the Board will establish or ratify policies and decisions on all matters that might create significant risk to the CDFI, financial or otherwise, and maintain a risk register.

7. Internal controls - the CDFI will maintain a set of procedures designed to protect against financial mismanagement and fraud.

8. Conflicts of Interest: A CDFI will manage any conflicts of interest arising out of its governance or business activities.

9. Complaints: A CDFI will deal honestly and efficiently with all complaints and if necessary will take part in concilliation or go to arbitration.

10.Social Performance: A CDFI will take steps to measure and report on its social performance.