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Historically, financial institutions in the United States have not served people of color effectively or fairly. Even today, people of color have less access to credit, pay higher interest rates for loans, and are less likely to receive venture capital funding as compared to their White counterparts. Serving these markets effectively is not only a moral imperative, but also an economic opportunity to enhance a company’s bottom line.

A follow-up to The Competitive Advantage of Racial Equity, developed in partnership with PolicyLink, this report highlights specific action steps leading companies in the financial sector have taken to create business value by using credit, savings, and investment products to address the unique challenges faced by communities of color. The companies featured in this report—Citi, Oportun, OneUnited Bank, Prudential Financial, and Impact America Fund—have found competitive advantage through their strategies to serve consumers who have historically been excluded.

Top Takeaways

  1. With a deeper understanding of the impacts of structural racism, financial services companies can avoid one-size-fits-all approaches to product and service development and better serve historically excluded populations of color and thus reach expanded markets.
  2. Leading financial services companies are reconceiving products and services to better meet the needs of people of color and are strengthening their external business environment by supporting public policies and norms that expand financial security.
  3. These companies also have strong internal catalystsincluding a diverse employee base and a culture of inclusionthat enable them to implement strategies that advance racial equity and business growth.
Today 18% of Black and 16% of Latinx consumers do not have an account in a mainstream commercial bank, compared to 3% of Whites.

This report was funded by the Robert Wood Johnson Foundation.