CITM2050 | Accreditation of community development finance institutions (CDFIs): Retail community development finance institutions

ITA/s340; SI2003/96 Schedule 1 (11)

CDFIs provide funding to enterprises in under-developed areas in two ways:

• directly, by financing individual enterprises in or for disadvantaged communities

or

• indirectly, by investing in businesses which themselves fund enterprises in or for disadvantaged communities.

CDFIs applying for accreditation are asked to say whether they are applying as retail CDFIs, that is, as a CDFI whose principal objective is to finance trading enterprises directly. If so, and if successful, the accreditation notification specifies that the body is accredited as a retail CDFI.

Any CDFI that is not accredited as retail CDFI is a wholesale CDFI.

The distinction between retail and wholesale CDFIs is relevant because in some cases the CITR scheme rules provide for different treatment of the two types of body, see

CITM3040 - Investments which are not relevant investments

CITM4070 - Limit of issue of tax relief certificates