Major US bank Citi said it will invest more than $1 billion in addressing the racial wealth gap in the US.
On Wednesday, Citi and the Citi Foundation said that it will dedicate over $1 billion for efforts that would close the racial wealth gap in the US. The program, called “Action for Racial Inequality,” also intends to boost the economic mobility in the country.
Citi’s ‘Action for Racial Inequality’
With the new initiative, Citi will help people of color by providing them better access to banking and credit. Moreover, the major American bank will also increase investment in Black-owned businesses and expand homeownership among Black Americans. Also, it aims to advance anti-racist practices in the financial services industry.
The central role we play in local economies and in the financial lives of Americans positions us to help close the racial wealth gap. Learn more about #Citi's efforts to create a fair and more inclusive society: https://t.co/7KPL9u5bdS pic.twitter.com/jaMI8df82Y
— Citi (@Citi) September 23, 2020
Citi chief executive Michael Corbat said that a critical part of creating “a fair and inclusive society” includes tackling racism and racial wealth gap. He added that Citi brings together the company’s capabilities to fight racism in the economy.
Corbat said that Citi commits to “leading the way and investing in communities of color to build wealth and strong financial futures.”
Investments in Tackling Racism in the Economy
In its website, Citi enumerates several ways they intend to spend its $1.15 billion investment on the initiative. The banking company plans to roll out these actions in the next three years.
Specifically, Citi dedicates $550 million to homeownership for people of color. It will also include affordable housing by minority developers. Meanwhile, $350 million will go to procurement opportunities for Black-owned business suppliers. Also, the company will invest an additional $50 million for Black entrepreneurs.
Moreover, Citi will shell out $100 million to support the growth and revenue generation of the Minority Depository Institution. Another $100 million of grants will support agents of addressing racial equity.
Closing Racial Wealth Gap
CNBC noted an Economy Policy Institue report that said White workers receive higher wages compared to Black and Latinx workers across almost every educational level. Meanwhile, a Citi report titled “Closing the Racial Inequality Gap” found out that the American economy lost $16 trillion because of the racial gap in pay among Black employees. The report further suggests that if the gaps are closed, the American GDP would add $5 trillion more.
Chief financial officer Mark Mason, and a Black senior executive, said that the commitments they announced mark only the beginning. “We need awareness, education, and action that drive results,” Mason stated.