While most of the CDFI fund appears to be protected by Congress, Hinkle Brown said he’s concerned that the rules won’t apply.

“It’s unclear what overzealous implementation in this regard would look like,” he said. “If they eviscerate and make non-functional the CDFI fund there’s a lot of costs, the Philly region will suffer.”

It could put a dent in regional economic development efforts in low income communities, said Leslie Benoliel, CEO of Entrepreneur Works in Philadelphia.

“[Community Development Financial Institutions] are like the capillaries of the financial distribution system in our country. And if you cut off the blood flow to those extremities, that will cause enormous harm,” Benoliel said.

Small business owners who may not typically trust the banking system or government often will work one-on-one with a community organization, she said.

CDFIs across Pennsylvania were allocated $32 million under financial assistance, healthy foods and persistent poverty county financial assistance awards last year.

If there’s no federal support, local nonprofits will likely have to raise money another way, said Varsovia Fernandez, CEO of the Pennsylvania CDFI Network.

“There is a possibility of moving to a fee for services model where small businesses need to pay to receive technical assistance education and I would imagine [loans would have] a higher rate to be sustainable,” she said. “I am hoping that it’s not a drastic change what the White House ends up doing.”

On March 17, U.S. Treasury Secretary Scott Bessent said in a statement that the Trump administration understands the significance of the federal fund and local community lending organizations.

“CDFIs [Community Development Financial Institutions] are a key component of President Trump’s commitment to supporting Main Street America in the pursuit of job growth, wealth creation and prosperity,” Bessent said.