Money—getting it, saving it, managing it, and sometimes borrowing it—is key to nearly everything we do in life: buying a home, going to college, starting a business, retiring with dignity, and passing something along to the next generation. Everyone should have access to the tools they need to earn, save, manage and grow their money. Banks and other financial institutions should invest in communities of color. And they should treat all customers fairly—regardless of factors like race, income or language.
Sadly, our financial system has long worked better for some than others, with people of color too often getting the short end of the stick. The most extreme example is what was called “redlining.” Banks, insurance companies and other financial institutions literally drew red lines on the map to mark off low-income or minority neighborhoods where they would not lend or invest.
Redlining is now illegal, but its effects linger. In 2013, for every dollar of wealth a white family had, the median Latino family had 10 cents, the median black family had eight cents, and the median Asian family had 68 cents. It is important to note that the common statistical habit of lumping economically and ethnically diverse Asian communities together masks high poverty levels in some Asian communities.
People of color are less likely than whites to own their own homes, and have been hurt worst by the foreclosure crisis – often because they were steered into high-cost loans that were more likely to lead to foreclosure. Too many people of color are left out of the banking system and resort to costly alternatives like payday lenders and check-cashing stores.
Greenlining brings the voices of communities of color directly into corporate boardrooms and to the halls of government. Our Economic Equity program focuses on the following areas:
- Equitable Housing and Homeownership: Because homeownership is crucial for family wealth-building and neighborhood stability, we work with government officials and financial institutions to remove structural barriers to homeownership and stem the recent tide of foreclosures.
- Diverse Businesses and Supplier Diversity: We ensure that minority small businesses have opportunities to grow, flourish and create jobs. We focus on access to capital and contracts (supplier diversity).
- Financial Industry Accountability: We meet directly with top financial institution executives to make sure they understand and serve the unique needs of communities of color.
- Regulatory Accountability: We communicate regularly with top regulators and political leaders at both the state and federal levels to advocate for policies that address the needs of communities of color and protect consumers from abuse. We meet regularly with top officials from agencies such as the Federal Reserve Board and the Consumer Financial Protection Bureau (CFPB).
- Financial Sector Diversity: When financial officials and regulators reflect the diverse backgrounds and experiences of the communities they serve, they are better equipped to serve those communities. We track the diversity of both banks and federal regulatory agencies and push them to diversify their leadership. We are taking the lead to ensure that the newly created Offices of Minority and Women Inclusion fulfill their potential.