What is the Community Reinvestment Act?

The Community Reinvestment Act (CRA) is a law in the United States that was passed in 1977, and is overseen by the Federal Reserve Board and the Office of the Comptroller of the Currency. The law was created to combat the effects of redlining, which is the practice of denying banking services, like mortgages or loans, to low-income and minority communities in certain areas. The CRA requires financial institutions to invest in their local communities, including by lending money to low- and moderate-income families, businesses, and organizations. Banks must also provide a certain level of services to the communities they serve, such as access to financial literacy services and ATM machines. In South Carolina, the CRA applies to state-chartered banks, as well as savings and loan associations and credit unions. These institutions must report to their regulator each year about their activities to ensure that they are meeting the CRA’s requirements. If a bank does not comply with the CRA rules, it can face penalties or other consequences. Overall, the Community Reinvestment Act helps to promote fair lending practices and to provide banking services to underserved communities. This can help to create economic opportunity in neighborhoods that may have historically been overlooked by banks and other institutions.

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What is the Community Reinvestment Act?

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