Pre-budget Submission on the Catalyst Community Finance Strategy 2026

Download PDF

Acknowledgement of Indigenous Rights, Structural Inequality, and Collective Responsibility

We acknowledge that the work of Catalyst Community Finance takes place on the traditional, ancestral, and unceded territories of Indigenous Peoples across Turtle Island. We honour the inherent rights and self-determination of First Nations, Inuit, and Métis communities, and their enduring relationships with the land, waters, and all living beings.

We also recognize that systemic injustices and structural inequalities that are rooted in colonization and perpetuated through ongoing discrimination that have placed certain people and communities at greater risk of social, economic, and climate-related harm. This includes Indigenous Peoples, Black and racialized communities, low-income individuals, 2SLGBTQI+ people, people with disabilities, and others whose experiences have too often been excluded from decision-making processes, including the development of financial and climate policy.

Catalyst’s work to support community finance, wealth building and inclusive finance is grounded in a commitment to reconciliation and Ethical Space, where Indigenous and non-Indigenous worldviews meet with mutual respect and shared accountability. We acknowledge that our approach is shaped by Western systems and that there are many valid and vital ways of knowing, being, and leading.

We are committed to learning from and with communities, and to co-creating solutions that reflect diverse histories, values, and futures.As we advocate for policies that unlock capital and empower communities, we do so with humility and a deep sense of responsibility to the land, to Indigenous Nations, and to all people striving for just, sustainable, and locally-rooted economies.

Pre-Budget Submission in Advance of the Upcoming Federal Budget Fall 2025

Download PDF

FAQ on the Community Finance Strategy

What is the Catalyst Community Finance Initiative proposing in its pre-budget submission?

Catalyst is proposing that the federal government implement a comprehensive Community Finance Strategy to strengthen Canada’s economic infrastructure and mobilize private, public, and philanthropic capital for local investment across Canada. This strategy includes five core actions:

  • Incentivizing local investment through tax credits and RRSP eligibility.
  • Establishing Federal Loan Guarantees to catalyze private and institutional capital for community-led projects.
  • Accrediting and capitalizing Community Finance Institutions (CFIs) through a national registry and a $250M fund.
  • Enacting a Canadian Community Reinvestment Act (CCRA) to require financial institutions to serve under-resourced communities.
  • Mobilizing Crown Corporations and Pension Funds by mandating local investment targets and improved disclosure standards.

This strategy aims to scale proven solutions while addressing critical gaps that prevent small- and medium-sized enterprises (SMEs), nonprofits, equity-deserving groups, and climate- and economically vulnerable communities from accessing the working capital they need to thrive.

Canada’s financial system is strong but not equitable. It was not built to serve all communities equally. A well-supported community finance sector can bridge this gap, empowering communities to invest in what matters most to them: local jobs, housing, climate resilience, and inclusive economic growth.

How do these recommendations support Federal priorities? Your Title Goes Here
  • A national community finance strategy will strengthen the federal government’s economic priorities by:
  • Increasing Affordability: Community finance delivers capital for housing, social services, and local cost-saving infrastructure (e.g. energy retrofits).
  • Supporting Workers: It creates jobs in communities through small businesses, co-ops, energy and community infrastructure.
  • Growing the Economy: Local capital investments stimulate regional economies, foster inclusive entrepreneurship, and improve Canada’s competitiveness.
  • Building a Healthy Future: Investments in clean energy, health infrastructure, and food systems support a resilient, low-carbon, nature-positive, sustainable future.

Community finance is economic infrastructure that aligns with Canada’s core economic goals of productivity, innovation, inclusion, and sustainability. With modest federal investment, this proven platform can be scaled quickly to drive transformational impact and build Canada.

How will incentivizing local investment benefit Canadians?

Incentivizing local investment will:

  • Unlock long-term, patient capital from retail and institutional investors by making community investments RRSP-eligible and introducing a tailored tax credit (e.g., 20–30% credit structure).
  • Direct investment to affordable housing, climate resilience, Indigenous infrastructure, and small business development, improving affordability and creating jobs.
  • Leverage significant private capital with minimal public cost—estimated $3–4 of private capital for every $1 in public funding.
  • Democratize economic development by enabling Canadians to invest in their own communities, boosting inclusive wealth-building
How does a comprehensive community finance strategy bolster economic security for Canadians?

The strategy strengthens economic security with:

  • New Capital and Leverage: Community finance investments can scale from $6 to $10 billion by 2030 in funds, bonds and other tools across Canada. This ecosystem can be rapidly scaled with modest federal support to unlock billions more in private investment. The expectation is a $3-4 in private capital mobilized for every $1 provided by the government.
  • Resilient Financial Infrastructure: Strengthened and sustainable community finance infrastructure fills capital gaps for enterprises, including Indigenous, rural and equity-deserving communities.
  • Job / Enterprise Creation and Maintenance: Creating up to 160,000 jobs and growing small enterprises with targeted investments in communities across the country.
  • Community Benefits: New affordable housing, new community infrastructure, and investments prioritizing equity deserving groups that reduce social and economic  inequality. Supporting affordability and resilience through investments in local food systems, green infrastructure, and housing.
What is a Community Finance Institution and why should these be accredited?

Community Finance Institutions (CFIs) are mission-driven organizations that provide capital to advance community economic development, equity, and inclusion. They prioritize social impact, reinvest profits, and ensure community accountability through governance, reporting, and design, while maintaining sound financial and lending practices. Although many such organizations exist in Canada, there is no formal structure or accreditation to strengthen their credibility or support their growth. These may include nonprofit loan funds, community credit unions, investment co-operatives, or Indigenous-led capital vehicles including Indigenous Financial Institutions (IFIs).

Canada lacks a national framework to recognize or support these institutions.  A formal registry and accreditation system would:

  • Build credibility and transparency
  • Enable access to tax incentives, loan guarantees, and technical assistance
  • Create pathways for partnerships with government and institutional investors
  • A national registry of qualified CFIs, would help direct public and private investment where it’s most needed
What is the proposed Canadian Community Reinvestment Act (CCRA)?

The proposed Canadian Community Reinvestment Act (CCRA)  aims to:

  • Require federally regulated financial institutions to demonstrate how they serve low- and moderate-income communities.
  • Mandate disclosure of lending, investments, and financial service access by geography and demographic group.
  • Tie community investment performance to regulatory incentives, such as merger approvals or access to liquidity facilities.
  • Embed community accountability into Canada’s financial system, which is currently highly concentrated and lacks obligations to invest in underserved areas.

A CCRA would help redirect private capital to support inclusive economic development and social equity, a step that could unlock billions for local economies.