Bill Introduced to Support Minority Owned Banks and Increase Access to Affordable Financial Services

Source: House Representative Gregory W. Meeks (D-NY, 5th)

Washington, D.C. - September 13, 2017 (The Ponder News) -- Representatives Gregory W. Meeks (D-NY), Joyce Beatty (D-OH), and Dwight Evans (D-PA), co-chairs of the Congressional Black Caucus’s Economic Development and Wealth Creation Task Force, introduced HR 3741, which would codify and enhance the Minority Bank Deposit Program (MBDP), which encourages federal agencies to utilize minority-owned banks and low-income credit unions as financial agents and depositories. MBDP was created in 1969 to help minority-owned banks obtain access to reliable and stable sources of funding to better provide loans within their local communities, many of which are underserved and lacking affordable financial services.

Although over 80 minority banks and low-income credit unions are certified to work with the federal government under the MBDP program, most of the certified institutions do not have an existing relationship with the federal government. The Congressional Black Caucus’s Task Force took on the challenge to reform MBDP after recent reports in the Wall Street Journal found that “the 2008 recession hit the black banking sector especially hard…black-owned banks could disappear entirely within the next eight to 12 years.”[1]

Congressman Gregory W. Meeks stated, “Limited access to affordable financial services is a persistent problem in my community, and many other underbanked communities around the US. Since the financial crisis, over 5,000 bank branches have closed their doors, leaving communities like mine with less safe and costlier financial services options. Our bill strengthens minority-owned banks, improves the financial health of the communities in which they serve, and provides more Americans with reliable and affordable banking options. I urge all of my colleagues to join us in this effort.”

“Since the 2008 Financial Crisis, the number of minority-owned and women-owned banks and credit unions have plummeted, leaving countless businesses and families in the surrounding communities with few, if any, financial options to start or grow their business—much less help to get a home or a car loan,” Congresswoman Beatty noted. “That is why it is critical that Congress pass legislation supporting the Minority Bank Deposit Program to ensure all American entrepreneurs and families have equal opportunity at achieving their American Dream.”

Making access to capital and credit a reality for all small business owners and entrepreneurs should be a reality for each and every individual in our neighborhoods. This is an issue too many individuals in our neighborhoods struggle with, specifically in our minority communities,” Congressman Dwight Evans said. “In our Commonwealth, the Pennsylvania MBDA Business Center has generated over $290 million contracts and financing, and created hundreds of jobs since 2004. The numbers don’t lie—they clearly demonstrate the viability of a model that creates jobs, spurs economic growth and facilitates community investment. I am pleased to join with my colleagues to introduce the Minority Banking Deposit Program, which reinforces, strengthens, and modernizes these critical financial institutions.