American Banker: Square to small banks: Don’t lump us in with Amazon and Facebook

American Banker, December 18, 2017: Square to small banks: Don’t lump us in with Amazon and Facebook

Earlier this fall, Square met with officials from the National Community Reinvestment Coalition, and they came away impressed by the company’s commitment to serving businesses that typically have trouble accessing credit. Square conducted a survey of 7,000 of its borrowers in January, which found that 54% of them were owned by women, and 37% were owned by minorities.

“Looking at this company and its origins and who the leadership is, it gives one hope that this company is going to do the right thing,” said John Taylor, president and CEO of the National Community Reinvestment Coalition.

The activists’ concerns have not yet been fully resolved. For example, Square is proposing that its Community Reinvestment Act assessment should focus on the Salt Lake City area, where its bank would be headquartered, but Taylor argues that is too narrow a focus for a national lending business.

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

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