Some questions have been raised whether those same regulatory issues are holding back Treasury from offering up TARP funds, as recommended by its CDFI Fund board within the agency. Fifteen to date have received TARP funds, for a total of $132 million.

In lieu of TARP, Pinsky says, "the Treasury could make equity equivalent investments in loan funds and some equity funds and secondary capital investments" to spur liquidity.

Some CDFIs are devising their own solutions to boosting capital and revenue streams. Calvert Foundation in Maryland, for example, has raised $160 million, with an average 3 percent rate of return, for a mutual-fund type instrument in "community development notes" that has attracted 4,700 investors - and the praise of Bernanke.

And Holmes of the Chicago loan fund is considering how his and other CDFI organizations can help unfreeze the secondary market. One idea is for some CDFIs that have enough capital to take the bullet for partner banks that are unable to front loans under tightened risk management guidelines. "Maybe we can take over the long-term asset and management risk over time. Maybe we become the solution for that, because we think we have the balance sheet and the regulatory environment to do that."

Longer-term solutions may also come into play from outside the CDFI circle of influence. The president's regulatory overhaul includes expansion of financial services companies subject to CRA, which could widen the field of potential CDFI financiers.

CDFIs are also eyeing the use of $80 million in funds allocated in 2009 to the Capital Magnet Fund, a vehicle controlled by the CDFI Fund created under the Home Economic Recovery Act.

CDFIs play a crucial role in economic development because they provide cost-effective financing to borrowers that might not qualify for conventional loans. The loans provided by CDFIs are done at levels too low to be profitable for standard banks, and often need to be ferried through several layers of participation.

"CDFIs are one of the few ways to get capital into the lower quintiles," said Pinsky. "The goal here is to get the credit flowing in a responsible way. I'm not sure who else besides CDFIs are going to be doing that."

In Chicago, a $1 million loan on a 2004 project by the Chicago Community fund provided the foundation for an Uptown-area mixed-use development of housing, office and retail that has since attracted a Target anchor store.

Holmes' group is also taking the lead on a $2 million to 3 million pre-development loan - one which required more than 17 different sources of financing - to replace a decaying 70-year-old public housing project with a new 3,000-unit affordable-housing development.

"That project will be worth hundreds of millions by the time it's done," says Holmes.