Photo: Chip Somodevilla / Getty Images
For: The Opinion
Tuesday, October 8
Biden Administration Provides $ 8.7 billion for Loans to Minority-Owned Businesses and Small Communities
Small businesses that are run by minorities and people who live in the poorest communities in the country, with limited access to banking received a support of $ 8, 7000 million dollars with the objective of stimulating loans to those groups of the population.
Both the vice president Kamala Harris, and the secretary of the Treasure, Janet Yellen announced this measure. “The wealth gap persists today, the homeownership gap persists,” Kamala Harris said of the need for investments in this sector .
According to the vice president, African-American entrepreneurs have three times more probabilities of giving knowledge that the lack of access to capital negatively affects their profit margins within their business activity.
The funds allocated come from the Emergency Capital Investment Program, that was created with the purpose of directing funds to Community Development Financial Institutions and minority depository institutions.
In accordance with the regulations, financial support will go to 186 institutions based in 36 states , the 54% of funds will be sent to banks and the 46% will be sent to credit unions.
The funds will be distributed in packages of more than $ 200 million dollars to the most banks large and less than $ 100, 000 dollars for smaller institutions.
For her part, the head of the Treasury, Janet Yellen, mentioned that this aid program will prevent small business owners from closing their locations, thus helping companies people to open more branches.
The financing announcement is part of $ 12, 000 millions of dollars for Community Development Finance Institutions Fund and minority banks set aside in legislation Harris helped to drafted when she was a California Senator, which was approved in late 2020. According to Reuters, this follows a $ 1 investment. 19 $ 1 Billion in Covid Relief Fund – 19 to more than 800 similar lenders in June.
African Americans represent the 13. 4% of the population in the country. Figures from the Federal Reserve show that they control only 4.3% of household wealth. More than half of the wealth of Afro-American families is in the form of pension rights, which cannot be passed on to future generations.
Since the beginning of the government headed by the President Joe Biden, the current federal administration is seeking that existing inequality gaps across the United States are significantly reduced .
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