What is the Community Reinvestment Act?

The Community Reinvestment Act (CRA) is a law in the United States that encourages banks to help meet the credit needs of the local communities in which they operate. The primary goal of the CRA is to ensure that banks do not discriminate against low-income or minority neighborhoods when it comes to lending. In Georgia, the CRA requires banks to document their community reinvestment activities, such as making loans to small businesses or providing banking services to low-income areas. Bank examiners from the federal government evaluate the CRA compliance of each bank every few years. Banks that do not comply with the CRA can be subject to various penalties, such as the loss of federal deposit insurance, restrictions on lending, or even legal action. Additionally, the CRA encourages banks to expand into new markets that were traditionally neglected by other banks. The CRA has been very successful in increasing the availability of credit and banking services in low-income and minority neighborhoods. This has led to improved economic opportunity for those in those communities, as they are better able to access the services needed to start and expand businesses. Additionally, banks benefit because they are able to tap into a whole new market and make a profit.

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What is the Community Reinvestment Act?

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