CEOs of America’s largest retail banks are testifying before Congress this week. As lawmakers turn their eyes on the banking industry, minority banks and their partnerships with the largest U.S. banks can shed light on the industry’s efforts to eliminate racial wealth disparities and the growth that these partnerships can drive. To close the racial wealth gap, banks should deepen partnerships with minority-led banks, and policymakers should eliminate regulatory barriers that prevent these banks from reaching their full potential.
Much of the work of providing access to bank accounts, home and business loans, and wealth-building opportunities for Black, Brown and Indigenous communities has historically fallen on the shoulders of under-resourced community lenders. Minority depository institutions and community development financial institutions have been on the front lines working to eliminate barriers to building wealth, credit and economic resilience for minority communities. MDI branches, which are often in census tracts with high minority populations, serve as critical hubs of financial opportunity in these communities.