2026 Community Reinvestment Act Proposal
For nearly 50 years, the Community Reinvestment Act (CRA) has helped connect capital with communities that have historically faced barriers to accessing credit and investment. As a Community Development Financial Institution (CDFI), every day we see how access to responsible capital can help small businesses grow, create quality jobs, develop affordable housing, and strengthen local neighborhoods.
Today, the CRA is at an important crossroads.
On August 12, 2026, the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) published a joint Notice of Proposed Rulemaking (NPRM) that would make significant changes to CRA implementation. The proposal could affect bank requirements and incentives, what activities receive CRA consideration, and how banks can lend, invest, and partner with organizations like CDFIs.
The agencies say the proposal is intended to focus CRA more heavily on lending, reduce regulatory burden (particularly for community banks) and ensure that community-development grants reach the communities they are intended to benefit.
As a CDFI, we support efforts to make CRA clear and effective. However, we are concerned that several of the proposed changes could limit how banks invest in underserved communities and partner with CDFIs.
What is the Community Reinvestment Act?
Congress passed the CRA in 1977 in response to longstanding concerns about financial institution practices, such as redlining, that were limiting access to capital and leading to disinvestment in low-income communities. At its core, the CRA is based on a straightforward principle: banks should help meet the credit needs of the entire community where they do business.
The CRA is administered through three federal banking agencies: Federal Reserve Board (FRB), Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC). *Note: the FRB did NOT take part in the Proposal*
The CRA incentivizes banks to provide loans, investments, grants, deposits, and other support in all communities, especially low- and moderate-income areas. Banks can provide this support through their own business practices or through organizations such as CDFIs. CDFIs are an important avenue because they can bring local knowledge, flexible lending, and the expertise needed to finance borrowers and projects that may not fit traditional bank lending models.
Historically, the CRA has played a vital role in helping CDFIs access the capital they use to serve their communities. In FY2024, OFN members received nearly $6.2 billion in borrowed funds from CRA-motivated banks, about 46% of their total borrowed funds. This capital helps CDFIs finance businesses, housing, and other community priorities.
What is Being Proposed in 2026 for the CRA?
1.Asset-Size Thresholds for Bank Classification
What’s Changing
The proposal would increase the asset-size thresholds used to determine how banks are evaluated.
|
| Current Asset-Size | Proposed Asset Size |
| Small Bank | Less than $412 million | Less than1$ billion |
| Intermediate Bank | $412 million – $1.649 billion | $1 billion – $10 billion |
| Large Bank | More than $1.649 billion | More than $10 billion |
The agencies estimate that approximately 800 banks would move into the small-bank category and 376 banks would move from large-bank to the intermediate-bank category.
Why it Matters
A bank’s CRA category affects how its community activities are evaluated. OFN shares that “Under the proposed threshold, more than 75% of all banks could be exempt from the community development (CD) test.” This means fewer banks will have incentives for community development, which could reduce the amount of capital flowing to community-development activities and CDFI partnerships.
2.Community Development Grants
What’s Changing
The proposal would change requirements for CRA-related grants.
In particular, the proposal also would require grants to be directly used for a plan, project, or initiative whose primary purpose is community development. Furthermore, large banks would have to document that grant recipients have overhead costs of no more than 15% for the grant to receive CRA consideration.
Why it Matters
Community development lending requires grant and infrastructure support to work well, beyond any specific project. By restricting grants to projects, plans, or initiatives, the new rules would eliminate flexible operating grants which nonprofits and CDFIs rely on to cover ongoing technology and staff costs for compliance, technical assistance, and other services for borrowers and communities. Additionally, strict overhead limits could make some grants harder to access and could reduce flexible resources that help organizations serve their communities.
3.Less Data Regulations
What’s Changing
The proposal would reduce some data collection and reporting requirements for banks.
For example, banks that move from large-bank to intermediate-bank treatment would no longer be required to collect and report certain data on small-business loans, community-development loans, and assessment areas.
Why it Matters
Good data helps communities, policymakers, advocates, and lenders understand where credit is flowing and where it isn’t.
Less data could make it harder to identify lending gaps, credit deserts, and unmet community credit needs.
What Could These Changes Mean for Our Community?
At its core, the CRA is about making sure that the communities where banks do business have access to the credit and banking services they need, especially low- and moderate-income communities that have historically faced greater barriers to financing.
The proposed changes could reduce some of those incentives and, in turn, affect the flow of capital to small businesses, affordable housing, community facilities, and other local priorities.
We want to help make sure that local businesses and community members have access to the capital and financial services they need to grow and thrive. CRA has been an essential tool to make that possible by encouraging banks to partner with organizations like CDFIs and invest in the communities they serve.
That is why at Neighborhood Community Development Fund, we believe it is important for community members to understand these proposed changes and make their voices heard.
What Can You Do?
Your voice matters.
The OCC and FDIC are accepting public comments on the proposed changes, with the comment period ending October 13, 2026.
If you are a borrower, small business owner, nonprofit, community organization, housing developer, community partner, or resident, you can share your perspective on why access to capital matters in your community.
Consider telling regulators:
- How access to capital has affected your business, organization, or community.
- How a bank or CDFI partnership has helped your business or community.
- How specialized support, consulting, or technical assistance from bank or CDFI has helped you or your business, organization, or community.
- Why strong CRA incentives and reliable lending data matter to your community.
Learn more: 2026 Proposed Changes to the Community Reinvestment Act – OFN
You can review the proposed rule and submit your comment through Regulations.gov
