Browse Tag


10 mins read

Empowering Minorities in Banking: Nicole A. Elam, President and CEO of the National Bankers Association

The National Bankers Association (NBA) is the leading trade association for the country’s minority depository institutions (MDIs). The Association strives to preserve and promote Black, Hispanic, Asian, Pacific Islander, Native American, and women-owned and operated banks across the country, all working to help communities that are underserved by traditional banks and financial service providers. The NBA works collaboratively with its member banks to eliminate the racial wealth gap.

MDIs are at the center of wealth creation by providing financial services, mortgages, and small business loans to minority, low- to moderate-income, and underserved communities — when other financial institutions would not.

Today, there are 21 Black banks. At its peak, there were 134. This decline means that fewer banks are serving Black communities. The National Bankers Association is working to address the decline in the number of Black banks and the growing digital divide that is exacerbating racial inequality in financial services.

The Association’s nonprofit affiliate is leading the way by creating partnerships with technology and fintech companies to provide solutions for minority banks that help bridge the digital divide and support their continued growth and success.

Nicole A. Elam, Esq. is the youngest President and CEO of the National Bankers Association since the Association’s founding in 1927.

In this interview, Nicole A. Elam, Esq. discusses the technical assistance and resources being offered to Black and minority banks in the digital era, the importance of increasing access to Tier 1 capital, encouraging private-sector investment, and more.

Nicole A. Elam

What technical assistance or resources are being offered to Black banks to help them thrive in an era of digital disruption?

Digital innovation is needed now more than ever to scale and remain competitive in the banking industry. But implementing technology is expensive. The largest banks spend $10 to $11+ billion a year on technology. Contrast that with $374 million, the average asset size of a Black bank.

As small banks, MDIs will never be able to outspend competitors. To solve this, the nonprofit arm of the National Bankers Association, in partnership with the Alliance for Innovative Regulation, launched MDI ConnectTech to bridge the digital divide and support the continued growth and success of these critical institutions.

With $10 million in leading grant support from the Citi Foundation’s Community Finance Innovation Fund, MDI ConnectTech works with MDIs to develop and integrate technology solutions that multiply their lending capacity and effectively increase the accessibility and affordability of financial services to underserved customers.

These efforts enable minority banks to remain sustainable financial epicenters for economically vulnerable consumers and small businesses.

How are Black banks best positioned to help our communities recover and overcome many of the systemic issues that have placed them at an economic disadvantage?

Black and minority banks were born out of racism because Black, brown, and immigrant communities could not go to mainstream financial institutions for their banking services. The unfortunate reality is that’s still the case today.

Since the Freedman’s Savings Bank founding in 1865, MDIs have been the cornerstone of efforts to narrow the racial wealth gap by providing financial services, mortgages, and small business loans to minority, low-to-moderate-income, and underserved communities — when other financial institutions would not.

Today, MDIs serve communities that are 77% minority, originate a higher share of small business loans to borrowers in low- and moderate-income census tracts when compared to non-MDIs, and generate 37% of their mortgages to minority borrowers compared to only 13% from non-MDIs. Data continues to show MDIs support the community when they need it the most.

What steps are being taken to give Black banks greater access to Tier 1 capital that would allow them to scale?

Tier 1 capital is essential for banks to grow and scale. For every dollar of capital invested, they can increase their lending and impact on the community by a multiple of ten. The U.S. Department of Treasury’s Emergency Capital Investment Program provided an unprecedented $3 billion in capital investments to MDIs to augment their efforts to support small businesses and consumers in their communities that were impacted by the pandemic.

The private and philanthropic sectors have also stepped up. Over the last three years, MDIs have experienced explosive growth, growing by 35% in assets – which is faster than the national average in the banking industry. And Black banks have experienced the most growth, growing by 56% in assets.

The global pandemic and the racial awakening of 2020 brought increased attention to MDIs. The federal government, private sector, and philanthropic community have all acknowledged that supporting communities and businesses hardest hit by the pandemic, and closing the racial wealth gap, involves investing capital into the financial institutions that sit in and serve those communities.

In what ways is the capitalization of Black banks an environmental issue as well as an economic one?

A 2021 report by the U.S. Environmental Protection Agency confirmed that minority and underserved communities are often more vulnerable to the harmful impact of climate change. During financial hardships brought on by events like climate change or a global pandemic, Black and minority banks are on the ground, deeply rooted and active in the community.

The National Bankers Association, and ten other organizations led by the African American Alliance of CDFI CEOs, formed the Community Builders of Color Coalition to urge EPA to ensure that minority communities benefit equally from the Greenhouse Gas Reduction Fund.

The Fund provides $7 billion in competitive grants for clean energy and climate projects that decrease greenhouse gas emissions and enable low-income and disadvantaged communities to access or benefit from zero-emission technologies. The Coalition is seeking a grant through this Fund for community lenders, like MDIs.

By supporting renewable energy, energy efficiency, and other clean energy projects, Black banks and MDIs help to create jobs, stimulate economic growth and promote social equity while positively impacting the environment.

How can private-sector investors be encouraged to make equity investments in Black banks?

The White House-led Equitable Opportunity Coalition is a great example of the private sector stepping up. Several Wall Street banks and Coalition members have made equity investments in Black and minority banks, realizing that if you want to support communities of color then you must invest in the community lenders that support them.

Over a century of data proves the important role Black and minority banks play in closing the racial wealth gap. Add that data to the fact that every dollar of capital invested in a Black bank can be leveraged to increase lending and impact in communities of color by a multiple of ten.

Taken together that makes a compelling argument of why the private sector is making equity investments in Black and minority banks to catalyze impact and advance their racial equity efforts.

How can the minority ownership status of our Black banks be protected?

The Federal Deposit Insurance Corporation defines MDIs as a depository institution in which minority ownership is at least 51% or the majority of board members are minority, and the community served is predominately minority. Given the role Black banks and MDIs play in communities, it’s essential to protect their ownership status.

One of this year’s legislative priorities for the National Bankers Association is modifying the Bank Holding Company Act to allow for significant infusions of non-dilutive equity investments in MDIs without jeopardizing their minority status.

Under the Act, a MDI’s minority ownership status is jeopardized when an investment exceeds 25% of the institution’s equity, which is easy to do if you’re a small bank. The Association is advocating to exempt community banks under $3 billion from the 25% change-of-control provisions to attract significant equity investments and to help protect the minority ownership status of minority banks.

by Tony O. Lawson

4 mins read

What Is a Community Development Financial Institution (CDFI)?

A Community Development Financial Institutions (CDFI) is a  private-sector financial organization in the United States that focuses mainly on personal lending and business development efforts in underprivileged local communities in need of revitalization.

By submitting an application to the US Department of the Treasury, CDFIs can receive federal funding. They can also obtain funds from individuals, corporate entities, and religious institutions in the private sector.

CDFIs are classified into four types:

Community Development Banks

By providing targeted loans and investments, community development banks help rebuild economically distressed communities. They are for-profit corporations whose boards have the representation of local communities.

Community Development Credit Unions

Community development credit unions encourage asset and savings ownership while also providing low-income people with affordable credit and retail financial services, often with a focus on minority communities. They are non-profit financial cooperatives that are owned and operated by their members.

Community Development Loan Funds

Community development loan funds (CDLFs) offer financing and development services to low-income businesses, organizations, and individuals. Loan funds are classified into four categories: microenterprise, small business, housing, and community service organizations.

Each loan fund is defined by the type of client it serves, although many institutions serve more than one type of client. CDLFs are typically non-profit organizations governed by boards of directors with community representation.

Community Development Venture Capital Funds

Community development venture capital funds offer equity and debt-with-equity features to small and medium-sized businesses in underserved communities. They can be for-profit or non-profit, and they must include community representation.

How Do Community Development Financial Institutions Work?

Community Development Financial Institutions (CDFIs) serve low-income and underserved urban and rural communities, as many of these citizens are underprivileged or have lacked access to responsible lending. Through community redevelopment, the goal is to assist this group of people in becoming more financially self-sufficient and contributing more to overall economic growth.

In the United States, there are currently over 1,100 chartered CDFIs, each with a focus on using innovative (and often less stringent) lending practices, educational efforts, and small business lending. The CDFI envisions an America where all people and communities have access to the investment capital and financial services they require to thrive.

CDFIs are typically controlled locally, with no interference from the central government.

The CDFI Fund for Community Development

The CDFI Fund is a federal program that promotes access to funds and local economic growth through its Community Development Financial Institutions Program, which provides underserved individuals and communities with loans, investments, financial services, and technical assistance.

The fund also provides tax credits to Community Development Entities, allowing them to attract private-sector investment and reinvest in low-income communities.


Lendistry is the only nationwide fintech CDFI, and they provide economic opportunities and progressive growth for small business owners and their underserved communities as a source of financing and financial education. If you have any questions or are interested in small business financing, please contact their team.

5 mins read

Minority Wealth Commission to raise $250 Million to boost Black Owned Businesses

The Minority Wealth Commission—a bi-partisan National Commission of diverse leaders representing a cross section of capital funding, procurement/contracting, economic development, and corporate/nonprofit leadership focused on minority businesses—announced today the launch of the FVLCRUM Fund.

The fund, with initial capital commitments of over $50 million, will raise a total of $250,000,000 to invest as a combination of equity and debt capital into proven, high-growth enterprises operated by people of color.

Clearinghouse CDFI—a national community development financial institution with a strong history of lending in communities of color—will help create and manage the FVLCRUM Fund. The fund brings together an exceptional team of private equity professionals with an established track record of investing in middle market minority owned businesses delivering strong investment returns. FVLCRUM Fund will make a sustainable and measurable impact towards closing the nation’s racial wealth gap by building wealth and business success for minorities.

“For too long minority businesses and communities have been disproportionately excluded from creating sustainable wealth,” said Henry Childs II, Executive Director of the Minority Wealth Commission and former National Director of the U.S Department of Commerce’s Minority Business Development Agency. “Lack of investment, ownership, and wealth in minority communities stifles income potential, school systems, job outlook, and business opportunities.

Minority businesses represent less than 1.3% of the overall assets under management by the investment industry. It is time for us to address the racial wealth gap, invest in minority businesses and to take full advantage of the value, innovation, and competitiveness they bring to our overall economy.”

According to a study by the W.K. Kellogg Foundation on Racial Equity, the U.S. stands to realize an $8 trillion gain in GDP just by closing the U.S. racial equity gap. This is more than the current GDP of every country in the world except the U.S. and China.

The Minority Wealth Commission has three key objectives: (1) to raise a series of minority wealth investment funds targeted toward creating wealth in minority communities, (2) to reduce the startup capital gap for entrepreneurs of color, and (3) to increase Assets Under Management (AUM) for diverse fund managers and increase the number of diverse fund managers in the industry.

“The United States Hispanic Chamber of Commerce (USHCC) joins the Minority Wealth Commission in recognizing and highlighting the importance of creating wealth in our minority business community,” said Ramiro A. Cavazos, President and CEO of the U.S. Hispanic Chamber of Commerce. “As we know, there are 8 million minority-owned small businesses that form the backbone of our American economy. We must create real change to transform our minority entrepreneurs by investing in our businesses through increased corporate procurement, federal contracting, access to capital, and private equity, in order to prioritize more businesses for our African-American, Hispanic, Asian, and more minority entrepreneurs.”

To facilitate investment in minority communities, the Minority Wealth Commission is focused on strategies that stimulate economic opportunity and mobility, encourage entrepreneurship, expand quality educational opportunities, and ultimately eradicate the racial wealth gap. The MWC is leading an effort to level-set capital investment parity for minority businesses and next-generation entrepreneurs of color that can expand our economy and impact our communities.

“Closing the RACIAL WEALTH GAP is an overriding issue of the NATION,” said Marc Morial, President of the National Urban League. “Lifting a generation of BLACK entrepreneurs by linking them to capital, connections, and contracts is a viable wealth gap closing strategy.”

“This fund represents transformative opportunities for minority-owned businesses, many disproportionately struggling from the devastating impacts of the pandemic,” said Delores Brown—Chairperson of the Clearinghouse CDFI Community Advisory Board—who also runs a nonprofit in South Los Angeles. “There is much work to be done to build a more equitable society. We hope to inspire other organizations and investors to take action.”

The Minority Wealth Commission and FVLCRUM Fund have already established a broad base of institutional and community partners dedicated to fundamental change for wealth creation in communities of color. This includes the National Urban League, the U.S. Hispanic Chamber of Commerce, and the U.S. Black Chambers, Inc., among several other organizations throughout the U.S.


Tony O. Lawson

Subscribe and Follow SHOPPE BLACK on Facebook, Instagram Twitter

 Get your SHOPPE BLACK Apparel!