Netflix is investing $100 million in Black-owned banks
New York (CNN Business) - Netflix (NFLX) on Tuesday said it would invest in Black-owned banks in an effort to help close the wealth gap between Black and White America.
The streaming service announced plans to deposit 2% of its cash, or an estimated $100 million, into Black-owned financial institutions and community development organizations, which have a better track record of lending to minority borrowers than mainstream consumer banks.
Minority-owned banks and credit unions represent just 1% of America's total commercial banking assets.
"We believe bringing more capital to these communities can make a meaningful difference for the people and businesses in them, helping more families buy their first home or save for college, and more small businesses get started or grow," Netflix said in a statement.
As part of the initiative, the company is also investing $25 million into the New York-based Local Initiatives Support Corporation, a development finance company with 35 offices across the country that backs Black entrepreneurs across a variety of businesses.
LISC President & CEO Maurice Jones said most Black-owned businesses are sole proprietorships with up to 10 employees with annual revenues of less than $1 million, and typically aren't prioritized by large commercial banks like Chase (CCF), Bank of America (BAC), or Wells Fargo (CBEAX).
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