NEW YORK–JPMorgan Chase has made a $4 million loan to Inclusiv’s $20 million Racial Equity Investment Fund.
The Racial Equity Investment Fund makes subordinated debt investments in high-impact Minority Depository Institution (MDI) and Community Development Financial Institution (CDFI) credit unions to support their growth and advance financial inclusion in Black, Hispanic, Native and AAPI communities, Inclusiv said.
With JPMorgan Chase’s support, Inclusiv said it has reached its capital goal for the Fund.
Will Lead to $40M in Loans
“Inclusiv is grateful for JPMorgan Chase’s ongoing support of our work to advance racial equity and financial inclusion,” said Inclusiv President/CEO Cathie Mahon. “This addition to our transformational Racial Equity Investment Fund will result in more than $40 million in safe and affordable loans to Black, Hispanic, Native and AAPI homeowners, small business owners and households, and will support the long-term growth of CDFI and MDI credit unions, allowing them to serve more members who would otherwise not have access to safe and affordable financial services.”
According to Inclusiv, JPMorgan Chase’s loan is earmarked to support activities such as a subordinated debt investment in OnPath Federal Credit Union, the largest MDI and fourth largest CDFI in the state of Louisiana. OnPath recently earned its Juntos Avanzamos designation, in recognition of the credit union’s cultural capacity to serve Hispanic communities.
How CU Will Use Funds
Inclusiv said OnPath will use Inclusiv’s investment to deepen the credit union’s capacity to serve Hispanic communities through a new Spanish-language micro-site and will continue creating asset building opportunities in low-income communities and Black and Hispanic communities.
“OnPath will further its commitment to the community through partnerships with Stukent to offer complimentary financial education curricula in high schools, the active inclusion of minority communities in lending programs, expansion of branch services into underbanked neighborhoods, and the provision of scholarships, homeownership support, and entrepreneurship opportunities through the OnPath Foundation,” Inclusiv added.
As CUToday.info reported earlier, Inclusiv launched the Racial Equity Investment Fund in 2020 to “ensure CDFI and MDI credit unions had access to the resources needed to address the impact of the COVID-19 pandemic in their communities.”
Addressing ‘Opportunity Gap’
“During the pandemic, the opportunity gap between Black and white households widened as Black households experienced more financial hardships and had less accumulated wealth to fall back on than white households,” Inclusiv stated. “Black and Hispanic-owned small businesses were also particularly hard hit by the pandemic and closed at significantly higher rates than white-owned businesses. These disparities set the stage for the racial wealth gap to widen further, making CDFI and MDI credit unions’ work to increase homeownership, support small businesses and build household financial stability more critical than ever.”
Inclusiv added the subordinated debt investments in CDFI and MDI credit unions allow these vital community institutions to take in more deposits, increase their lending, and expand their services, “helping them better meet their communities’ needs.”
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