100 dollar bills growing in grass

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ast year, rapper Killer Mike ignited the #bankblack campaign by encouraging folks to open up accounts and make deposits in local Black-owned banks, which resulted in people investing millions of dollars in financial institutions owned by African-Americans. But sitting $50 or $100 in a community bank is only the first step in revitalizing these companies. The long term game is really about building a relationship with a local Black bank, and the reality is that banking Black requires some additional effort and  commitment. Black banks have less physical locations,older technology and tend to be city or regionally based, which means there is no access to a physical location when traveling.

The good news is that many banks are working to address all of these issues.

“We don’t have the money to invest in technology like our competitors,” says Blondel Pinnock, SVP and chief lending officer at Carver Federal Savings Bank. “But we are spending money on infrastructure. We know millennials aren’t going to spend time at branches. At Carver, you can deposit online. You can transfer money to people. We are also working with a global to bank to create a partnership that will give our customers access to their ATMs. The thought has to be to on how to maintain relevance and profitability.”

According to Pinnock, in addition to setting up savings accounts to hold funds, Black financial institutions need customers to actively “bank” there. “What helps banks is having a share of your wallet,” she says. Most people actively utilize more than one bank to split multiple savings, checking and investment accounts. Pinnock contends more customers need to think of ways to integrate Black banks as one of the accounts they use regularly. “You don’t need to put all of your money in a community bank. You can have a relationship with both a big and local-based institution.” Pinnock encourages supporters to consider the multiple points of entering into a financial relationship, particularly those that generate revenue through interest and fees, such as setting up a CD (certificate of deposit) or an additional debit card. Another great place to support local banks is via lending, like secured lines of credit and business loans. She adds: “There are customers that major banks would never do business with due to the requested loan amounts or stringent underwriting criteria. We work with clients the big banks simply don’t have access to.”

“What helps banks is having a share of your wallet. You don’t need to put all of your money in a community bank. You can have a relationship with both a big and local-based institution.”

Black banks may not be perfect but they will only get better if the community elects to invest in them. We have to keep pushing #bankblack as more than a hashtag or moment; it’s a way of life.Thinking of sharing your wallet with a Black bank but hesitant to commit? Here are a few common issues and the solutions:

The Complaint: Black banks don’t offer enough ATM access, which makes it hard to get your cash without fees.

The Fix: There is this amazing thing called budgeting. Back in the day people physically went to banks and withdrew the amount of cash they anticipated spending for a week and doled it out as needed. If this absolutely out of the question, many Black-owned banks have partnerships with ATM networks, such as Allpoint, which allow you to access funds with limited or no fees.

 

The Complaint: Black banks don’t have competitive, modern or efficient technology.

The Fix: The bank apps may not be sexy, but they allow you to move money and deposit. What more do you really need? And many of the institutions are upgrading their tech offerings.

 

The Complaint: Black banks have limited branches and hours.

The Fix: This issue does require a little work. If you are traveling you have to plan ahead by either scoping out the region’s access points (partnerships) online or bringing cash to avoid withdrawal fees. The good news is that debit cards are universally accepted, so you can use those freely. This is also an opportunity to utilize sharing your wallet by using accounts you hold with national banks.

 

The Complaint: The name on your bank card is less likely to be recognized by others.

Solved: Let. It. Go. Your card won’t be denied due to lack of brand recognition. It also gives you an opportunity to educate folks about your bank and why you elected to support it.