NEW YORK–Inclusiv has launched a $20 million Racial Equity and Resilience Investment Fund it said deploys secondary capital to expand economic relief and financial inclusion for credit unions that serve communities of color.
Inclusiv said the pool will leverage more than $200 million in lending to minority-owned businesses, homeowners and consumers to withstand the current economic crisis and build wealth and assets. The Inclusiv Racial Equity and Resilience Fund is made possible through support from the Robert Wood Johnson Foundation.
“The Racial Equity and Resilience Investment Fund will build upon the highly successful Inclusiv Resilience Grant Fund launched in June 2020 that has raised more than $1 million in grant funds to 59 minority designated credit unions around the country,” Inclusiv said.
These funds are supporting credit unions to provide emergency relief loans, expand their outreach to minority businesses, get connected with capital, and to reach unbanked and underbanked consumers with access to responsible financial services, Inclusiv added.
On the ‘Front Lines’
"Community development credit unions have been on the front lines working to secure financial security for their members and communities. Minority credit unions are frequently the sole source of responsible capital in communities of color," said Cathie Mahon, Inclusiv CEO. "Investments in this network of institutions has immediate and real impact. This capital will increase access for low-income households, ensure that stimulus relief is distributed equitably, and respond to the unprecedented level of economic shock caused by COVID-related shutdowns."
Inclusiv noted River City FCU in San Antonio received the first Resilience Investment Fund secondary capital loan, which has gone to support the CU’s expansion of its banking and lending to Latinx and immigrant communities in San Antonio. The $116.6 million credit union has 11,873 members and $101.4 million in total loans.
Capital Leveraged 60 Times Over
Inclusiv noted an analysis it conducted on the impact of Secondary Capital investments found credit unions receiving these investments leveraged the capital 60 times over in a period of five years. The growth of CDCU, CDFI and minority credit unions multiplies impact as each step up in scale is accompanied by dramatic increases in loan deployment, number of product lines and volume of specialized lending. This vast potential has massive implications for changing the financial landscape for survival through the pandemic and growth for generations.
For info: www.inclusiv.org.