Unlocking Capital: The Economic Case for Community Finance in Canada

In this first-of-its-kind in-depth economic research report, author Simon Marmura Brown, PhD clearly articulates that community finance helps close the access to capital gap: the investment gap that prevents enterprise development and community projects led predominantly by women, Black and Indigenous entrepreneurs and rural communities.

Community finance is practical economic infrastructure that connects capital to community opportunity.

The economic case is clarion: when capital reaches communities, it multiplies.

Unlocking Capital provides a clear, evidence-based case for our Comprehensive Community Finance Strategy. 

The strategy is structured around 5 pillars:

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

Unlocking Capital identifies a pattern that has held for a century.

Canada has recognized the need for community-controlled capital and built promising institutions to deliver it, however, it has rarely enacted the enabling legislation, built the national recognition systems, or sustained the capitalization required for those institutions to achieve their potential. Three gaps, in particular, have persisted across every era:

  • the absence of a national accreditation and recognition system for community
    finance institutions;
  • the absence of a legislative framework requiring financial institutions to serve
    underserved communities;
  • the absence of sustained, adequate capital for the intermediaries that do the
    work.

For a deep dive into the breadth of today’s Canadian community finance marketplace, see SVX’s Market Report 2026. For complementary research, see  Built to Exclude by Social Capital Partners, to understand why the need is present and why traditional banks are structurally incapable of meeting this moment.

Unlocking Capital: the Economic Case for Canadian Community Finance was researched, drafted, and produced by the University of New Brunswick’s Pond-Deshpande Centre. It was prepared by Simon Marmura Brown, PhD – Strategic Director, Research and Knowledge Mobilization at the Centre. 

The report was commissioned and funded through a strategic partnership between Catalyst Community Finance and Impact United Academy and was developed in close collaboration with both organizations, whose insights and priorities helped inform the policy recommendations it contains.

Reviewers: Jo Reynolds, Catalyst Community Finance; Michelle Baldwin, Impact United Academy; Geraldine Cahill, Catalyst Community Finance; James Chan, Impact United Academy; Suzanne Faiza, Tapestry Community Capital; Suzanne Merchant, Tapestry Community Capital; Wayne Miranda, Definity Foundation; Vanessa Paesani, UNB’s Pond-Deshpande Centre; Stephanie Pinnington, Tapestry Community Capital; Adam Spence, SVX