Kenneth Kelly, Chairman and CEO of First Independence Bank.
Black wealth continues to be a topic of debate not only for the African American community, but also for anyone who wants to see that black communities have a better financial life. Black-owned banks and black bankers act as a buffer between financial well-being and a low-income society.
The creation of the Association of Negro Bankers, which became the National Association of Bankers in 1948, gave Negroes a sense of financial freedom at the time. Now more than ever the need for black banks is becoming apparent as African Americans struggle to find financial resources and equality.
“Black bankers have a legacy of many generations that provide financial literacy services to customers that other banks cannot or do not want to provide. For 95 years, members of the National Association of Bankers have been helping people with qualified black services that directly solve problems that prevent borrowers from being bankers or eligible for loans, ”said Nicole Elam, president and CEO of the National Association of Bankers. “This help is often seen in the fact that bankers train small business owners [and] church and community leaders are major best practices in accounting. Today, through the National Alliance of Bankers, banks owned by blacks and other minorities support traditionally excluded and underserved households with asset accumulation and sustainability. ”
Early in the country’s history, blacks were banned from opening bank accounts in traditionally white financial institutions. The creation of black banks began before the Civil Rights Movement, when Dr. Martin Luther King Jr. encouraged blacks in Memphis to withdraw their funds and transfer them to the care of Tristate, a bank owned by blacks in the city in 1968. In 1888, Capital Savings Bank opened its doors as one of the country’s first black-owned banks. The opening of the Savings Bank of the Great Fountain of the United Order of True Reformers in Virginia offered African Americans a second black-owned financial institution to protect their funds, thus opening the door to create additional black banks.
In Michigan, First Independence Bank is the only black-owned financial institution headquartered in the state. The first Bank of Independence, which has been a member of the NBA for more than 35 years, is located in the heart of Detroit and first opened its doors in May 1970. Since then, he has served as a light for African Americans and an ally in the banking industry.
By helping to open accounts and apply for financial loans, First Independence Bank has helped bridge the gap in financial health, wealth and literacy.
“Studies by the FDIC and the Federal Reserve have shown that individuals who apply to African-American banks are more likely to receive more assistance throughout the application process. [They are] more likely to get better help and [help] that they need to complete the application process, which also leads to better results, ”said Kenneth Kelly, chairman and CEO of First Independence Bank.
In 2020, Statista published a study that found that more than 13 percent of black families in the country do not have bank accounts. Representing the second largest demographic group, African Americans turn to outside sources for cash checks, loans and other financial services.
“We’re likely to be inadequate, which means we have a higher percentage of African Americans who don’t have a bank account at all. This means that they use cash withdrawals and payday loans, which is very expensive, and most often it is the most vulnerable people, who are likely to have the least amount from an economic point of view, “said Kelly.
Developing financial awareness in the black community is key to destroying generations and systemic strongholds. With just 42 banks owned by blacks, a race across the country to change the mindset of African Americans and their relationship with money continues.
“The basic relationship between black-owned banks and the communities they serve is crucial to changing attitudes towards blacks. We know that clients need help in building healthy financial habits and accessing education and resources in personal finance. But we cannot rest on our laurels; our commitment extends to past changes in thinking and education to the development of behavior in the community that will lead to the creation of a wealth of generations, ”Elam said.
The National Association of Bankers acts as a leading force in the minority banking sector. Hoping to provide society with education and opportunities in banking, the organization continues to be a path and partner on the path to economic freedom for minorities.
It’s just my saying that “money is oxygen in a capitalist society,” and we need to figure out together how to keep more oxygen in our communities, how to learn to get more oxygen in the communities we support, and until we do, we we will always see the differences we see in terms of racial wealth, ”Kelly said.