What does the Community Reinvestment Act require financial institutions to do?

The Community Reinvestment Act (CRA) is designed to encourage financial institutions to meet the credit needs of the communities in which they operate, particularly low- and moderate-income neighborhoods. By requiring these institutions to provide loans, investments, and services that can help strengthen these communities, the CRA aims to promote fair access to credit and help reduce discrimination in lending practices.

This focus on meeting the deposit and credit needs of communities supports financial stability and growth, fostering an environment where residents have better access to necessary financial resources. In this context, answering that the CRA requires financial institutions to meet the deposit and credit needs of communities is fundamentally aligned with the Act's objectives of community investment and economic development.

Other options do not align with the requirements set forth by the CRA. Commingling funds, appraising properties, and licensing community managers involve specific activities related to finance and property management but do not reflect the core purpose of the CRA, which is focused on ensuring equitable access to financial services for all community members, particularly those historically underserved.