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Salon: Watchdog questions why Wells Fargo reported giving only one large PPP loan to a Black-owned business

Salon, July 23, 2020: Watchdog questions why Wells Fargo reported giving only one large PPP loan to a Black-owned business

The Trump administration’s reliance on big banks to distribute small business aid under the Paycheck Protection Program and a lack of transparency requirements have resulted in many Black-owned businesses being shut out of the program. One bank, Wells Fargo, reported distributing only one PPP loan larger than $150,000 to a Black-owned business out of the more than 12,000 it gave out.

Even when they had better financial profiles than White-owned businesses, Black business owners faced racial discrimination from banks, according to a recent study. A disproportionate number of PPP loans flowed to majority-White areas, The New York Times reported.

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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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