Fig Loans, a U.S.,-based fintech company that offers credit building alternatives to predatory loans for low-income borrowers, announced on Tuesday it has become a Certified B Corporation and federally certified Community Development Institution (CDFI).
According to Fig, CDFIs are certified by the U.S. Department of the Treasury’s Community Development Financial Institutions Fund. In order to become a certified CDFI, a financial institution must have a primary mission of promoting community development; provide financial products and services; serve one or more defined low-income target markets; and maintain accountability to the community it serves. Many CDFIs are community development banks and credit unions; a select few non-regulated institutions like lenders and venture capital funds receive the designation.
Founded in 2015, Fig uses predictive analytics to provide low-cost credit and credit-building financial products to populations unable to access traditional forms of credit. The company’s mission involves helping borrowers build credit and transition into mainstream credit products. In regards to the certification, the Fid team added:
“Certification is the next step for Fig to deepen its engagement with traditional financial institutions. As a CDFI, Fig can help banks fulfill their obligation to provide capital to underserved communities through the Community Reinvestment Act. Fig will work with their advisory board of nonprofit partners to select the most suitable banks for long-term partnerships in each community.”