Square is moving to help minority and underserved groups by investing $100 million in nonprofit financial institutions and Black-owned businesses.
The move is timed to meet rising needs in a tumultuous year, with Square promising to make deposits in community development financial institutions (CDFIs) and minority depository institutions (MDIs) and invest in various programs supporting Black-owned banks and businesses, Square said Thursday.
The investment amount represents 3% of Square’s cash and marketable securities at the end of the second quarter of 2020, and it will continue providing support to these causes in the future, Square said in a press release.
“Square believes it is critically important to ensure that access to financial services is not just reserved for those with privilege,” Square said, noting there are fewer than two dozen Black-owned U.S. banks.
Square said it will invest $25 million in CDFIs and MDIs across the U.S. and $25 million in the National Bankers Association’s Keeper Fund, which drives employment opportunities for underserved groups.
The Black Economic Development Fund will receive another $25 million investment from Square to fund Black-owned businesses and projects and programs to revitalize minority communities.
Square has earmarked another $25 million for future investment in social impact projects, with details to be announced later, Square said.
Square noted that it made its first deposits to CDFIs and MDIs last year.
One beneficiary of Square’s investments is Citizens Bank, a Nashville, Tenn., CDFI that received a deposit from Square earlier this year.
“As the oldest continuously owned and operated African-American bank in the U.S. and as a CDFI, Citizens Bank is very focused on establishing collaborative partnerships with organizations that are aligned with our longstanding commitment to provide superior financial services and financial education to the African-American community, as well as other underserved minority groups,” Sergio Ora, Citizens Bank’s president and CEO, said in the release.
