Visa launched a new program to invest in minority depository institutions (MDIs) with the goal of reducing economic disparities and expanding access in communities of color across the United States.
The credit card company’s new Visa Minority Depository Institutions Accelerate program will invest up to $100 million via deposits with MDIs to help them catalyze lending. Further, Visa will provide tailored insights and digital solutions to these banks to help them meet the needs of their clients.
Economic and health shocks from the COVID-19 pandemic have severely affected minority households already suffering from longstanding disparities in wealth. Closing the racial wealth gap could add up to $1.5 trillion to the U.S. GDP by 2028, according to a study by McKinsey and Company. MDIs play a unique role in increasing access to financial services for underserved populations.
“Visa acknowledges that economic disparities must be addressed through equitable access to financial resources. We want to do our part by working with MDIs and other associations tied to diverse communities,” Michelle Gethers-Clark, chief diversity officer & head of corporate responsibility at Visa, said. “We believe MDIs play a critical role in improving economic outcomes and are proud that Visa MDI Accelerate will advance our shared goal of uplifting everyone everywhere.”
Visa will work with FDIC-designated MDIs to determine interest in participating in the program.
“Creating more equitable wealth distribution requires more inclusive opportunities for MDIs to uplift the communities they serve,” Nicole Elam, executive director of the National Bankers Community Alliance, the nonprofit affiliate of the National Bankers Association, said. “We are pleased this multi-faceted program will enhance the lending capacity of MDIs as well as empower minority-owned and -operated banks with social and economic impact data to better serve their customers and communities.”