Community Development Banks: Enabling Access to Finance for Poor Communities

Community Development Banks (CDBs) are a growing and dynamic manifestation of the solidarity economy in Brazil. This unique system of solidarity finance is currently in place in more than 100 Brazilian municipalities. Created by local associations to (re)organize local economies, they develop financial tools (microcredit, social currency, correspondent banking) governed and organized by the users themselves. In this article, we outline a general overview of these initiatives. First, we explain some characteristics of CDBs. Second, we present the experience of two CDBs, Banco Palmas and Banco Bem, which have excelled in promoting access to the means of production, consumption, education and training for large sections of the population of the neighbourhoods in which they work. Finally, we study the relations between these CDBs and public banks.

Unrisd website www.unrisd.org/en/library/blog-posts/community-development-banks-enabling-access-to-finance-for-poor-communities