[House Hearing, 117 Congress]
[From the U.S. Government Publishing Office]






 
                      THE LEGACY OF GEORGE FLOYD:

                      AN EXAMINATION OF FINANCIAL

                     SERVICES INDUSTRY COMMITMENTS

                     TO ECONOMIC AND RACIAL JUSTICE

=======================================================================

                             HYBRID HEARING

                               BEFORE THE

                       SUBCOMMITTEE ON DIVERSITY

                             AND INCLUSION

                                 OF THE

                    COMMITTEE ON FINANCIAL SERVICES

                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED SEVENTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             JUNE 29, 2021

                               __________

       Printed for the use of the Committee on Financial Services

                           Serial No. 117-34
                           
                           
                           
                           
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]                           




                            ______                       


               U.S. GOVERNMENT PUBLISHING OFFICE 
 45-359 PDF             WASHINGTON : 2021 

                           
                           
                           

                 HOUSE COMMITTEE ON FINANCIAL SERVICES

                 MAXINE WATERS, California, Chairwoman

CAROLYN B. MALONEY, New York         PATRICK McHENRY, North Carolina, 
NYDIA M. VELAZQUEZ, New York             Ranking Member
BRAD SHERMAN, California             FRANK D. LUCAS, Oklahoma
GREGORY W. MEEKS, New York           BILL POSEY, Florida
DAVID SCOTT, Georgia                 BLAINE LUETKEMEYER, Missouri
AL GREEN, Texas                      BILL HUIZENGA, Michigan
EMANUEL CLEAVER, Missouri            ANN WAGNER, Missouri
ED PERLMUTTER, Colorado              ANDY BARR, Kentucky
JIM A. HIMES, Connecticut            ROGER WILLIAMS, Texas
BILL FOSTER, Illinois                FRENCH HILL, Arkansas
JOYCE BEATTY, Ohio                   TOM EMMER, Minnesota
JUAN VARGAS, California              LEE M. ZELDIN, New York
JOSH GOTTHEIMER, New Jersey          BARRY LOUDERMILK, Georgia
VICENTE GONZALEZ, Texas              ALEXANDER X. MOONEY, West Virginia
AL LAWSON, Florida                   WARREN DAVIDSON, Ohio
MICHAEL SAN NICOLAS, Guam            TED BUDD, North Carolina
CINDY AXNE, Iowa                     DAVID KUSTOFF, Tennessee
SEAN CASTEN, Illinois                TREY HOLLINGSWORTH, Indiana
AYANNA PRESSLEY, Massachusetts       ANTHONY GONZALEZ, Ohio
RITCHIE TORRES, New York             JOHN ROSE, Tennessee
STEPHEN F. LYNCH, Massachusetts      BRYAN STEIL, Wisconsin
ALMA ADAMS, North Carolina           LANCE GOODEN, Texas
RASHIDA TLAIB, Michigan              WILLIAM TIMMONS, South Carolina
MADELEINE DEAN, Pennsylvania         VAN TAYLOR, Texas
ALEXANDRIA OCASIO-CORTEZ, New York   PETE SESSIONS, Texas
JESUS ``CHUY'' GARCIA, Illinois
SYLVIA GARCIA, Texas
NIKEMA WILLIAMS, Georgia
JAKE AUCHINCLOSS, Massachusetts

                   Charla Ouertatani, Staff Director
                Subcommittee on Diversity and Inclusion

                     JOYCE BEATTY, Ohio, Chairwoman

AYANNA PRESSLEY, Massachusetts       ANN WAGNER, Missouri, Ranking 
STEPHEN F. LYNCH, Massachusetts          Member
RASHIDA TLAIB, Michigan              FRANK D. LUCAS, Oklahoma
MADELEINE DEAN, Pennsylvania         TED BUDD, North Carolina
SYLVIA GARCIA, Texas                 ANTHONY GONZALEZ, Ohio, Vice 
NIKEMA WILLIAMS, Georgia                 Ranking Member
JAKE AUCHINCLOSS, Massachusetts      JOHN ROSE, Tennessee
                                     LANCE GOODEN, Texas
                                     WILLIAM TIMMONS, South Carolina
                                     
                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    June 29, 2021................................................     1
Appendix:
    June 29, 2021................................................    33

                               WITNESSES
                         Tuesday, June 29, 2021

Coles, Fabrice, Vice President, Bank Policy Institute............     4
Cravins, Donald, Jr., Executive Vice President and Chief 
  Operating Officer, National Urban League.......................     6
Hamilton, Darrick, Professor, Economics and Urban Policy, The New 
  School.........................................................     8
Holkins, Jonay Foster, Senior Director, Policy, the Business 
  Roundtable.....................................................    10
Miah, Hassan, Founder and Chief Executive Officer, Paybby........    11

                                APPENDIX

Prepared statements:
    Coles, Fabrice...............................................    34
    Cravins, Donald, Jr..........................................    88
    Hamilton, Darrick............................................    96
    Holkins, Jonay Foster........................................   101
    Miah, Hassan.................................................   106

              Additional Material Submitted for the Record

Beatty, Hon. Joyce:
    Written statement of the American Bankers Association........   109
    Written statement of Color of Change.........................   119
    Written statement and attachments of the Financial Services 
      Forum......................................................   123
Holkins, Jonay Foster:
Written responses to questions for the record submitted by 
  Chairwoman Waters..............................................   133


                     THE LEGACY OF GEORGE FLOYD: AN

                   EXAMINATION OF FINANCIAL SERVICES

                    INDUSTRY COMMITMENTS TO ECONOMIC

                           AND RACIAL JUSTICE

                              ----------                              


                         Tuesday, June 29, 2021

             U.S. House of Representatives,
                          Subcommittee on Diversity
                                     and Inclusion,
                           Committee on Financial Services,
                                                   Washington, D.C.
    The subcommittee met, pursuant to notice, at 3:08 p.m., in 
room 2128, Rayburn House Office Building, Hon. Joyce Beatty 
[chairwoman of the subcommittee] presiding.
    Members present: Representatives Beatty, Tlaib, Dean, 
Garcia of Texas, Williams of Georgia, Auchincloss; Wagner, 
Gonzalez of Ohio, Gooden, and Timmons.
    Ex officio present: Representative Waters.
    Chairwoman. Beatty. The Subcommittee on Diversity and 
Inclusion will come to order.
    Without objection, the Chair is authorized to declare a 
recess of the subcommittee at any time. Also, without 
objection, members of the full Financial Services Committee who 
are not members of this subcommittee are authorized to 
participate in today's hearing.
    With the hybrid format of this hearing, we have some 
Members and witnesses participating in person and others on the 
Webex platform.
    I would like to remind all Members participating remotely 
to keep themselves muted when they are not being recognized by 
the Chair. The staff has been instructed not to mute Members, 
except when a Member is not being recognized by the Chair, and 
there is inadvertent background noise.
    Members are also reminded that they may participate in only 
one remote proceeding at a time. If you are participating 
remotely today, please keep your camera on. And if you choose 
to attend a different remote proceeding, please turn your 
camera off.
    Today's hearing is entitled, ``The Legacy of George Floyd: 
An Examination of Financial Services Industry Commitments to 
Economic and Racial Justice.''
    I now recognize myself for 4 minutes to give an opening 
statement.
    Good afternoon. Following the death of George Floyd, 
Americans of all races, young and old, from the mailroom to the 
C-suites, were united and took to the streets to demand 
justice, and an end to the systemic racism that permeates many 
of our institutions and corporations.
    The voices of the many resonated in boardrooms and C-suites 
as corporate leaders used the moment to empathize with the 
frustrations of protesters, their employees, and even 
stakeholders.
    George Floyd's murder was an indisputable example of 
systemic racism that shocked the consciousness of the American 
public, thus, today's hearing entitled, ``The Legacy of George 
Floyd: An Examination of Financial Services Industry 
Commitments to Economic and Racial Justice.''
    The CEO of JPMorgan Chase, Jamie Dimon, said in the weeks 
following George Floyd's death, ``We are watching, and 
listening, and we want every single one of you to know we are 
committed to fighting against racism and discrimination 
wherever and however it exists.''
    The CEO of Bank of America, Brian Moynihan, said in his 
testimony to the Senate Banking Committee in May of 2021 that 
his company hosted thousands of courageous conversations with 
their employees and social justice leaders to foster 
understanding and a common approach to addressing injustice.
    Leading banks and other financial institutions pledged to 
serve as allies and apply their power, their influence, and 
their resources to support the fight for social justice and to 
invest in economic opportunities for Black communities that 
have been redlined and shut out.
    This hearing comes 13 months after the death of George 
Floyd, and recent analysis by Creative Investment Research 
shows that U.S. corporations pledged $50 billion, including $33 
billion from financial services companies.
    While pledges and platitudes that affirm values are 
important, we stand at a crossroads that demands tangible and 
transparent action.
    Today, I stand and urge my colleagues to join me in calling 
upon corporations to live up to their commitments, to be 
intentional, and to implement sustainable practices that will 
permanently address the economic inequities that divide our 
nation.
    Transparency and accountability--you are going to hear that 
a lot today--must be at the heart of your commitments, and I 
call upon financial companies to fully embrace the spirit of my 
legislation, H.R. 2123, the Diversity and Inclusion Data 
Accountability and Transparency Act, and to disclose their 
workforce diversity and inclusion performance data to their 
Office of Minority and Women Inclusion (OMWI) directors 
annually.
    I call upon business leaders to join in the fight for 
social justice that impacts your workforce, to champion 
diversity and inclusion practices, and to develop and leverage 
financial products and eliminate racial and gender wealth gaps.
    The financial services industry is a cornerstone of the 
American economy and workforce. So, we want to hear today that 
you are going to be a part of the trajectory of future 
investment in the Black and rural communities.
    Let us bend the arc of justice by examining and committing 
to a fully-inclusive economic future. I look forward to hearing 
more from all of you.
    The Chair now recognizes the ranking member of the 
subcommittee, Ranking Member Ann Wagner, my colleague, and 
someone who has been with us from the very beginning of the 
Diversity and Inclusion Subcommittee.
    I now recognize you for 5 minutes for an opening statement.
    Mrs. Wagner. Thank you, Madam Chairwoman, and thank you to 
our witnesses for joining us today.
    Today, we will be discussing how America's banks are taking 
positive steps toward a more inclusive banking system, the 
areas where banks can do more to support underserved 
communities and unbanked individuals, and how innovation and 
Fintechs such as Mr. Miah's firm, Paybby, can be a part of the 
solution.
    The members on this committee believe that all Americans 
should have access to financial institutions, financial firms, 
and the financial system to support and build economic 
prosperity. They should have the opportunity to save and invest 
for their family, for college, and for retirement.
    The subcommittee has examined and will continue to examine 
the strides that the financial services industry has made 
toward promoting diversity and inclusion and expanding banking 
services to historically underserved communities.
    America's banks and other organizations in the financial 
services industry promised to devote resources to advancing 
racial equity. Banks pledged billions of dollars to programs 
designed to close the wealth gap, drive homeownership, and 
bolster Community Development Financial Institutions (CDFIs) 
and Minority Depository Institutions (MDIs).
    Banks have also been partnering with community 
organizations focused on racial inequities, such as the 
Neighborhood Assistance Corporation of America (NACA) and the 
National Community Reinvestment Coalition (NCRC).
    I want to list just a few of the noteworthy commitments 
from the financial services industry to increase banking 
services and better assist America's underserved communities.
    Bank of America committed $1.25 billion over 5 years to 
advance racial equality and economic opportunity. As part of 
that effort, the bank announced in May 2021 that it would 
expand its national affordable homeownership program. The bank 
has made more than $350 million in investments, including 
equity investments in 40 minority-focused funds and 14 MDIs and 
CDFIs.
    In 2021, Goldman Sachs announced the One Million Black 
Women initiative, a $10-billion investment initiative focused 
on investing in Black women to, ``drive investment in housing, 
health care, access to capital, education, job creation and 
workforce advancement, digital connectivity, and financial 
health.''
    In 2020, JPMorgan Chase announced a $30-billion-over-5-
years commitment to racial equity. The commitment includes 
initiatives for affordable housing, small business expansion, 
and neighborhood development.
    In addition to these private-sector commitments, Congress 
has provided $12 billion to CDFIs and MDIs in the December 
Consolidated Appropriations Act for Fiscal Year 2021.
    I look forward to continuing to work with America's banks 
on these initiatives, and I am encouraged by the progress we 
have seen these past few years.
    I thank the chairwoman, and I yield back.
    Chairwoman Beatty. Thank you so much.
    I would now like to welcome all of our witnesses who are 
here today in person or remotely: Mr. Fabrice Coles, vice 
president of government affairs at the Bank Policy Institute; 
Mr. Donald Cravins, the executive vice president and chief 
operating officer at the National Urban League; Mr. Darrick 
Hamilton, a professor of economics and urban policy with The 
New School, formerly from my great State of Ohio, at The Ohio 
State University; Ms. Jonay Holkins, senior director of policy 
at the Business Roundtable; and Mr. Hassan Miah, the chief 
executive officer at Paybby. Welcome.
    Witnesses are reminded that your oral testimony will be 
limited to 5 minutes. You should be able to see a timer on your 
screen or on the desk in front of you that will indicate how 
much time you have left. When you have one minute remaining, a 
yellow light will appear.
    I would ask that you be mindful of the timer, and when the 
red light appears, to quickly wrap up your testimony so that we 
can be respectful of both the other witnesses' and the 
subcommittee members' time. And without objection, your written 
statements will be made a part of the record.
    Mr. Coles, you are now recognized for 5 minutes to present 
your oral testimony.
    Mr. Coles is testifying remotely, and appears on the 
screen.

    STATEMENT OF FABRICE COLES, VICE PRESIDENT, BANK POLICY 
                           INSTITUTE

    Mr. Coles. Thank you, Madam Chairwoman.
    Chairwoman Beatty, Ranking Member Wagner, and members of 
the subcommittee, thanks for having me today. I am honored to 
appear before you.
    My name is Fabrice Coles. I am a vice president at the Bank 
Policy Institute (BPI), a nonpartisan public policy research 
and advocacy group.
    I appreciate the invitation to discuss the banking 
industry's efforts to help reduce racial inequality. Banks must 
be a part of the solution if there is to be real improvement in 
outcomes for all communities, especially communities of color, 
many of whom have been left behind economically.
    Today, however, our focus is on banks' efforts to reduce 
inequality in Black communities, and how they are leveraging 
business models, networks, and resources to better serve them.
    I work directly with a group of executives responsible for 
this agenda at the banks and can share that this has been a 
time of purposeful action. Banks have decided strategies, 
agreed upon budgets, allocated resources, and built teams to 
execute on this agenda.
    Investments have been made. Partnerships have been 
cemented. Product innovation is ongoing. Philanthropy is 
continuing. More than $50 billion has been committed. More than 
a billion dollars of support and investment has already gone 
out the door. Progress has been made.
    But given the nature and residue of centuries of financial 
exclusion, much remains to be done. Racial equity gaps in 
income, health, education, housing, and wealth have proven 
intractable.
    But the events of 2020, the disproportionate impact of the 
pandemic on Black communities, and the global response to the 
murder of George Floyd, have spurred fresh thinking and action.
    Banks' actions to combat racial equity gaps include 
investments, partnerships, product innovation, and 
philanthropy. BPI member banks know that in order to address 
centuries of financial exclusion, they have to invest in people 
and organizations that are driving positive economic outcomes.
    They are making investments in Community Development 
Financial Institutions (CDFIs) and Minority Depository 
Institutions (MDIs), supporting the next generation of Black 
entrepreneurs, and bolstering neighborhood revitalization 
efforts alongside Black-owned investment firms.
    They are investing debt and equity capital, but also sweat 
equity, working with partners to ensure that these investments 
bring shared prosperity.
    Lastly, banks are investing in the future of their own 
organizations, redoubling their efforts to recruit, retain, 
empower, and promote Black talent and working harder to ensure 
that the senior levels of their firms reflect America's 
diversity.
    Banks know that change involves investing time and 
resources with others. That is why banks are scaling impact by 
partnering with diverse organizations to hasten the delivery of 
support to Black communities.
    They partner with Federal regulators and State and local 
governments to promote new thinking about how to broaden access 
to banking services, credit, and jobs. They have worked with 
national organizations, providing affordable housing counseling 
and home purchase support.
    They have joined nonprofits to support policy research, 
provide technical assistance, and supply needed resources to 
minority-owned institutions. They partner with Historically 
Black Colleges and Universities (HBCUs) to invest in the future 
of financial services talent, and they have entered into joint 
ventures to execute billion-dollar deals with Black-owned 
broker-dealers and MDIs.
    These partnerships are complemented by a growing product 
portfolio. Banks have expanded their offerings of services and 
are increasing access to credit products for underserved or 
unbanked borrowers.
    The pandemic made clear the need for access to transaction 
accounts, especially as economic activity migrated online, and 
banks are offering more no-fee, low-minimum-balance accounts to 
attract customers into the system.
    Then, banks are deepening those new relationships by 
offering bridge, small-dollar, small business, and special 
purpose credit loan options.
    Lastly, they are providing various forms of home-buying 
support and exploring how artificial intelligence (AI) can be 
used to reduce the cost of credit for borrowers who have been 
underserved in the past, such as those with low or no credit 
scores.
    Bank strategies are executed thanks to the combined efforts 
of business and product units and affiliated philanthropic 
organizations to boost results in speed.
    Banks have committed billions of dollars in grants with 
fewer strings and with accelerated decision times for 
allocating philanthropic capital. This is all taking place 
across an expanded list of grantees and partners in areas such 
as small business, education, public health, social justice, 
and civil rights.
    In conclusion, when the world watched as George Floyd was 
murdered, we all stopped to consider what could be done to 
improve equity in our society.
    Banks were a part of that introspection, and in the year 
since that horrible tragedy, have rededicated their efforts to 
be drivers of brighter days ahead for all American communities.
    Accompanying my written testimony is a best-practices 
document initially created for the banks in the midst of last 
summer's extraordinary public conversation about racial 
justice, which has been released today for the first time. It 
gives a view into the seriousness of the tactical 
considerations underway at banks to support broad-based 
economic opportunity.
    An honest assessment of the foundation that has been laid 
leaves me with a parting thought. Much has been done. Sadly, 
much more is left to do. But I can say that I am hopeful.
    Thank you, Madam Chairwoman, for having me here today. I 
look forward to answering your questions.
    [The prepared statement of Mr. Coles can be found on page 
34 of the appendix.]

    Chairwoman Beatty. Thank you very much.
    Mr. Cravins, you are now recognized for 5 minutes to give 
an oral presentation of your testimony.

STATEMENT OF DONALD CRAVINS, JR., EXECUTIVE VICE PRESIDENT AND 
         CHIEF OPERATING OFFICER, NATIONAL URBAN LEAGUE

    Mr. Cravins. Good afternoon, Chairwoman Beatty, Ranking 
Member Wagner, and members of the subcommittee.
    My name is Don Cravins, Jr., and I serve as the executive 
vice president and chief operating officer of the National 
Urban League. On behalf of the entire Urban League movement, 
which consists of 91 affiliates in 36 States and the District 
of Columbia, I thank you for convening this hearing.
    Chairwoman Beatty, I would be remiss if I did not offer my 
condolences to you and your family for your recent loss. I want 
you to know you have been in the prayers and the thoughts of 
the Urban League the entire time.
    Chairwoman Beatty. Thank you.
    Mr. Cravins. The National Urban League is an historic civil 
rights organization dedicated to economic empowerment, equity, 
and social justice.
    Founded in 1910 as a result of the great migration of 
African Americans to the north, the Urban League collaborates 
at the national and the local levels with community leaders, 
policymakers, and corporate partners to elevate the standard of 
living for African Americans as well as other historically-
underserved groups.
    We do that by focusing, really, on four primary areas: 
education; health; jobs; and housing. Pertinent to this 
subcommittee and the work that you do, the National Urban 
League has specific programs designed to foster financial 
literacy, homeownership, small-business financing, and home 
foreclosure prevention.
    These programs and services touch nearly 2 million 
Americans each year. It is correct that after the killing of 
George Floyd and other incidents of racism, many financial 
institutions turned to the National Urban League and others and 
our network of affiliates to address issues related to systemic 
discrimination and inequities.
    For some of these financial institutions, this was a 
continuation of the support for the work we have been doing, 
and was based upon previous long-standing relationships. For 
others, this was the beginning of new partnerships.
    And although we are thankful, Madam Chairwoman, for the 
commitments, and are hopeful that a real impact will be made 
and felt in the communities we serve, what we are most hopeful 
about is that these commitments will symbolize the ending of 
corporate philanthropic redlining.
    The fact remains that there is still real work to be done, 
and the resources that have been pledged alone cannot remedy 
centuries of inequities and disparities.
    Research shows that despite significant economic progress 
over the past decades, African Americans experience far worse 
economic conditions than White Americans or the American 
population as a whole. African Americans experience recession-
like conditions even when the economy is thriving for other 
Americans. The unemployment rate for African Americans has been 
and continues to be approximately twice the rate of White 
Americans.
    The typical African-American household earns just 59 cents 
for every dollar a White household earns. The median wealth of 
African-American families is $17,000, and for White families, 
it is $171,000. Only 42 percent of African Americans own their 
homes, compared to 73 percent of White families.
    African Americans struggle to obtain mortgages, consumer 
loans, and even credit cards. More than one in four African 
Americans do not have a credit score, and 17 percent do not 
have traditional bank accounts. Ranking Member Wagner mentioned 
some of these issues.
    So, how did America get here? We got here because African 
Americans were excluded from the agricultural revolution due to 
enslavement, and excluded from the prosperity of the last 
century due to disenfranchisement and Jim Crow legal 
discrimination.
    When you add those discriminatory practices to the mass 
incarceration of African Americans that followed, it is very 
clear how America has gotten here and why we have this 
persistent wealth gap.
    So, what does a real commitment to equity look like? Equity 
cannot be fully achieved by financial institutions simply 
donating money to external partners and relying on us to change 
the world, the minds and the hearts of America.
    Financial institutions must also look inward and ensure 
that their own systems create inclusive places, and places with 
which to do business. This is not only the morally-right thing 
to do, but it is also good for business.
    I am proud to say that some institutions have retained the 
National Urban League for internal unconscious bias training or 
to provide supplier diversity training.
    Our message to our corporate clients is simple: If you want 
real change, if you desire a real commitment to equity, then 
you must be transparent and be willing to set an example. 
Otherwise, you are only partially committed to equity. You are 
window dressing.
    When it comes to economics in the work of financial 
institutions, there is much work to be done, Madam Chairwoman. 
The organizations best-suited to assist financial institutions 
with addressing these issues have traditionally been 
underfunded. But the commitments are a start.
    However, none of our organizations can make these changes 
alone. It will require government and our financial 
institutions and our nonprofit organizations working together.
    So, again, thank you for allowing me to be here today, 
Madam Chairwoman and subcommittee members, and allowing me to 
testify on this very important subject.
    [The prepared statement of Mr. Cravins can be found on page 
88 of the appendix.]
    Chairwoman Beatty. Thank you for your testimony, Mr. 
Cravins.
    Mr. Hamilton, you are now recognized for 5 minutes to give 
an oral presentation of your testimony.
    Mr. Hamilton is testifying remotely, so he is on the 
screen.

STATEMENT OF DARRICK HAMILTON, PROFESSOR OF ECONOMICS AND URBAN 
                     POLICY, THE NEW SCHOOL

    Mr. Hamilton. Thank you, Chairwoman Betty, Ranking Member 
Wagner, and other esteemed members of the subcommittee, and I 
too want to offer my heartfelt condolences, as well as 
gratitude for everything that you do, Madam Chairwoman.
    I am Darrick Hamilton, the Henry Cohen Professor of 
Economics and Urban Policy, a university professor at The New 
School, and the director of the Institute on Race and Political 
Economy.
    The fact that George Floyd could be killed in broad 
daylight by law enforcement for over an 8-minute period with a 
knee in his neck while screaming for mercy that he couldn't 
breathe has to be the result of a devaluation of his life 
because he is Black.
    After repeated examples of similar killings, this is vivid, 
and should, at least by now, be undisputed. The immoral 
devaluation of Black lives has been ingrained in America's 
political economy and it is long overdue for a reckoning.
    So, as a nation, are we finally ready to reverse our 
enduring and immoral blight of racism and redefine economic 
good to embrace the principles of morality, humanity, and 
sustainability, and to provide a patriotic pathway to promote 
our shared prosperity and achieve racial and economic justice?
    The government has a fiduciary responsibility to facilitate 
inclusion, civic engagement, and social equity for all its 
people. All policies and government actions are rooted in 
norms, especially those related to production, transaction, and 
distribution. Government should promote diversity and inclusion 
and belonging in all aspects of civic and political economy 
simply because it is just and the right thing to do.
    To achieve this, we need a deeper understanding of how 
devaluing individuals based on identities like race, gender, 
and sexual orientation, how they relate to political notions of 
who is deserving and who is undeserving.
    This is essential to expand our knowledge beyond 
conceptions of individual transactions into workings of larger 
political economy structures that affect us all.
    Our current economic system is founded upon the values of 
self-interested accumulation without bounds, but our economy 
should be grounded in different values, values of economic 
inclusion, civic engagement, social equity, human dignity, 
sustainability, and shared prosperity.
    Our enormous and persistent racial wealth gap is an 
implicit measure of our racist past, a past rooted in a history 
in which White Americans have been privileged by government, 
political, and economic interventions that afforded them access 
to resources and iterative intergenerational accumulation 
associated with those resources.
    This is in contrast to a history for Blacks and indigenous 
Americans where their personhood and whatever capital they may 
have established has always been vulnerable to exploitation and 
extrapolation by state-complicit confiscation, destruction, 
fraud, terror, theft, and other acts of violence.
    Still, much of the framing around the racial wealth gap 
focuses on poor financial choices and decisions on the part of, 
largely, Black, Latinx, and poor borrowers. That framing is 
wrong. The directional emphasis is wrong.
    It is more likely that meager economic circumstance, not 
poor decision-making or deficient knowledge, constrains choice 
itself and leaves poor borrowers with little to no financial 
options but to obtain and use predatory and abusive financial 
services.
    Households with few assets and low incomes are compelled to 
turn to high-cost, unconventional, and alternative financial 
products. They generally are aware that these products are 
predatory but they have no alternatives.
    These last-resort debt traps render recipients indentured 
borrowers, having to pay higher and higher interest rates and 
fees until, ultimately, they default on the original principal.
    Racial inequality and despair are not inevitable. Rather, 
they are the result of political choices. Likewise, we can make 
different political choices.
    Congress needs to provide public options, options that 
directly compete with and crowd out inferior private options, 
private options that do not ensure universal and quality access 
to health care, housing, schooling, financial services, 
capital, and the free mobility throughout society without the 
psychological and physical threat of detention or bodily harm 
at the hands of a state-sanctioned terror because someone's 
identity is linked to a vulnerable or stigmatized group.
    Inequality is not rooted in deficient people but, rather, 
deficient resources and power allocations. Let us change this 
paradigm. Let us be bold.
    Let us advocate for programs and initiatives that truly 
empower people with economic security, dignity, and authentic 
agency to define and achieve their goals.
    Thank you for your time.
    [The prepared statement of Mr. Hamilton can be found on 
page 96 of the appendix.]
    Chairwoman Beatty. Thank you, Mr. Hamilton.
    Ms. Holkins, you are now recognized for 5 minutes to give 
an oral presentation of your testimony.

  STATEMENT OF JONAY FOSTER HOLKINS, SENIOR DIRECTOR, POLICY, 
                      BUSINESS ROUNDTABLE

    Ms. Holkins. Good afternoon.
    Chairwoman Waters, Chairwoman Beatty, Ranking Member 
Wagner, and members of the House Financial Services Committee's 
Subcommittee on Diversity and Inclusion, thank you for the 
opportunity to testify today and for holding this hearing.
    Business Roundtable is an association of over 230 CEOs of 
America's leading companies, working to promote a thriving U.S. 
economy and to expand opportunity for all Americans.
    In my role, I am responsible for overseeing the racial 
equity and justice agenda. Just a few months ago, during one of 
the greatest tests of our democracy, I was serving as Judiciary 
Counsel for Congressman David Cicilline.
    Prior to that, I was a senior litigation associate at a 
D.C. law firm representing community health centers and other 
Federal grantees and safety net providers across the country.
    I joined Business Roundtable in April because I believe 
that the CEOs' commitments to ensure that the business 
community is doing their part to solve the racial wealth gap 
are necessary and important.
    2020 was a year of reckoning for America. In response to 
the murder of George Floyd, Business Roundtable CEOs released a 
set of policing reform principles and have continued to press 
publicly for bipartisan policing reform legislation.
    Our members then turned to an issue central to equity in 
our economy: the racial wealth gap. That gap is a product of 
hundreds of years of policies and practices that have denied 
economic opportunity to Black Americans, despite our many 
contributions.
    With humility, Business Roundtable engaged in hundreds of 
conversations with social justice experts, including fellow 
panelist Darrick Hamilton, as well as Marc Morial and Cy 
Richardson at the National Urban League. That process was 
focused on gathering information with the goal of driving 
support towards areas where the research and the data showed it 
mattered most.
    On October 15, 2020, this process culminated in the special 
committee's release of a set of corporate actions and public 
policy recommendations focused on six key areas: employment; 
finance; education; housing; health; and justice.
    As a CEO organization that represents almost all sectors of 
the economy, Business Roundtable is uniquely positioned to 
bring about real change for communities of color and really 
work toward advancing racial equity, and our member companies 
are doing just that.
    For example, over the past year, PayPal has invested $510 
million toward equity and inclusion and social justice causes. 
This includes $15 million in PayPal empowerment grants that 
were distributed directly to approximately 1,400 Black-owned 
businesses, many of which were also operated by Black women. 
Prudential made a $10-million contribution to remove barriers 
to financial wellness in underserved markets.
    Cummins deployed $3 million to CDFIs, the NAACP, and SCORE 
to support Black-owned enterprises in Indiana, Minnesota, and 
Tennessee. Duke Energy deposited $5 million into Optus Bank, a 
Black-owned bank in South Carolina. Bank of America made more 
than $350 million in various investments across its primary 
focus areas of health, jobs, affordable housing, and small 
businesses.
    Our member companies are also committed to increasing 
diversity and inclusion in the workplaces from the top down. 
Business Roundtable announced a multi-year effort to reform 
their hiring and talent management practices, and address 
inequities in employment practices.
    We know that there is a long way to go on this. These are 
just a few of the many examples of our member companies that 
have made good on their promises.
    One year of work cannot undo the centuries of harm done to 
Black Americans and other people of color. There is so much 
more that needs to be done to address the racial wealth gap and 
other inequities faced by communities of color.
    We are committed, I am committed to making real progress, 
and we welcome the partnership of this committee to advance our 
shared goal of securing equity and opportunities for all 
Americans.
    Thank you for the opportunity to serve as a witness before 
the subcommittee. I look forward to your questions.
    [The prepared statement of Ms. Holkins can be found on page 
101 of the appendix.]
    Chairwoman Beatty. Thank you very much, Ms. Holkins.
    And now, Mr. Miah, you are recognized for 5 minutes to give 
an oral presentation of your testimony.

STATEMENT OF HASSAN MIAH, FOUNDER AND CHIEF EXECUTIVE OFFICER, 
                             PAYBBY

    Mr. Miah. Thank you for the invitation. My name is Hassan 
Miah, and I am the CEO and founder of Paybby Corp. We are a 
financial technology company. We are a Fintech focused on the 
empowerment of the Black and Brown communities.
    I started the company, and it was founded in August of 2020 
in wake of the death of George Floyd, which deeply affected me.
    At Paybby, we are the only Black-owned company that offers 
an FDIC-insured mobile bank account where it is possible to get 
a free bank account in less than 5 minutes. Over the past few 
months, we have met with several of the largest banks, 
including the largest Black-owned banks in the country. Our 
observations include the following.
    Major banks have announced large financial commitments to 
the Black community, and Black banks have announced investments 
from the big banks. This is to be applauded.
    However, the scale of the announced commitments appears to 
be larger than the actual investments. The evidence is still a 
little sparse on whether the announced commitments have 
resulted in the incremental support needed for the Black 
community.
    The biggest concern is the lack of what we call in the 
private-sector, key performance indicators (KPIs), that show 
accountability of announcement to results.
    Also, the approach and types of commitments taken by the 
banking industry may not make a material difference unless 
expanded.
    The financial services industry includes the private equity 
and venture capital industries, which account for a large share 
of the capital used to finance businesses and support financial 
inclusion and economic empowerment in the Black community.
    According to recent reports, Black entrepreneurs only 
receive about 1 percent of all private equity and venture 
capital. This has not changed much. The VC industry has, 
however, made several investments in the last year supporting 
new Black founder funds, which is great.
    However, the scale still appears to be minuscule relative 
to the industry, and not of any major material significance. 
Private equity and venture capital-backed Fintech is the 
fastest growing category of alternative banking and lending in 
this country.
    Many of these non-minority banks or Fintechs target the 
Black community, but their business models are not designed to 
support racial equity and often result in more income and 
wealth extraction from the community.
    For example, just one small example, tax advantage private 
equity firms are now making investments and buying residential 
houses to be made available to rent. This could potentially 
crowd out the supply of housing and reduce opportunity for the 
Black community to achieve homeownership, the biggest 
contributor to wealth creation.
    Private equity receives its largest share of capital from 
government and private pension funds, of which the Black 
community is a capital supplier. Therefore, the lack of 
investment in Black businesses and Black entrepreneurs actually 
results in a transfer of wealth from the Black community to 
other communities.
    The approach taken by banks and corporations to support 
Black banks and MDIs can only have a limited impact. Black 
MDIs' total aggregated assets are approximately $10 billion, 
compared to total U.S. banking assets of $20 trillion.
    Given the limited size and smaller geographic focus, they 
are simply incapable of addressing the racial equity gaps. 
Fintechs, however, are creating the transformation of banking 
and financial services, and similar to the other industries, 
tech-driven companies are designed to scale and efficiently 
build new models to support the market.
    Traditional companies and banks generally do not have the 
skills to make those kind of changes to a tech-driven economy 
and, therefore, also many of these small community banks are 
adding Fintechs on top, but none of them are Black-owned banks. 
Therefore, they are not part of it.
    For the banking industry, the keys to closing the racial 
wealth gap and supporting racial equity are greater direct 
investment, recirculation of capital, and reduction of 
excessive banking costs.
    The spending power of the Black community is over $1.3 
trillion, and approximately $4 trillion from the Black and 
Brown communities. Yet, only 2 percent of that capital is 
circulated.
    Outside the U.S., where large, formerly-poor nations are 
gaining access to banking, new Know Your Customer (KYC) and 
alternative credit scoring systems are being developed that are 
as reliable as anything in the United States. Yet, this does 
not exist here, and the Black and Brown communities continue to 
stagnate. Actually, the racial wealth gap is still increasing.
    Thank you for inviting me here, and I appreciate your time. 
Thank you.
    [The prepared statement of Mr. Miah can be found on page 
106 of the appendix.]
    Chairwoman Beatty. And thank you so much for your 
testimony.
    I am pleased to announce that we have been joined by the 
Chair of the full Financial Services Committee. In addition to 
that, she is the leader and actually the founder of the 
Diversity and Inclusion Subcommittee under Financial Services.
    It gives me great honor to yield the floor to Chairwoman 
Maxine Waters.
    Chairwoman Waters. Thank you very much, Chairwoman Beatty, 
for holding this hearing, and thank you for inviting the 
witnesses who have testified here today.
    The information that they are sharing with us will be very 
helpful in pursuing the kind of justice and equity that your 
subcommittee is responsible for making happen and, of course, 
our overall Financial Services Committee is pursuing.
    I will start with Mr. Cravins and Mr. Hamilton. After the 
deaths of George Floyd, Ahmaud Arbery, and Breonna Taylor last 
year, our country entered another period of racial reckoning, 
and a national focus on the systems of injustice that have 
deprived Black Americans of basic human rights and equal 
opportunities, including opportunities to build wealth, for 
hundreds of years, as the American public turned their eye to 
corporate America in the search for commitments to address 
racial injustice.
    Several financial institutions made promises to lend or 
provide billions of dollars toward capital for Minority 
Depository Institutions and Community Development Financial 
Institutions, direct grants to Black businesses, and charitable 
donations to organizations serving communities of color.
    Mr. Cravins and Mr. Hamilton, many of these institutions 
have been slow to follow through on their commitments. How can 
we increase the disclosure that is necessary to help hold 
public companies accountable to the promises that they made, 
and what are the other ways that Congress can ensure that these 
priorities are not simply empty platitudes, and that an 
institution's policies are not perpetuating racism and 
inequality through its operations, products, and services, and 
how can we prevent companies from easily pulling back on their 
commitments based on changes within their organizations?
    I have heard a lot today that, basically, deals with some 
of these questions that I am asking. Let me just say, I know 
the work of the Urban League. I have been in the government for 
many years, so of course, I have worked closely with the Urban 
League, and I understand what your priorities are, what your 
mandates are, and what you do.
    But we have had a lot of discussion here today, 
particularly about major companies in this country, that after 
these deaths that I alluded to, made commitments. How do we 
hold them to their promises?
    Mr. Cravins. Madam Chairwoman, I think today's hearing is a 
very good start or a very good continuation. You and Chairwoman 
Beatty and the ranking members--because this is not a race 
thing; this is an American issue--I think by bringing attention 
to this issue, by bringing the companies here, by talking to 
the CEOs.
    And you raise a great point, Madam Chairwoman. It is not 
just the Fortune 100. These commitments were made by companies 
of all sizes, and we at the Urban League are very committed.
    When companies have called us and said, hey, we want to be 
committed, how can we help, we have absolutely given them a 
road map. We have tried to help them design programs that would 
help them make changes in our communities. As I have said, we 
feel we have been underfunded and ignored for decades.
    And so, we will continue to work with them, but we are 
asking for this committee, and the Members of Congress from 
both sides of the aisle, to hold people accountable, to 
continue talking about this issue, and to continue having these 
hearings.
    Chairwoman Beatty, can we have this hearing a year from 
now? Can we have another hearing 2 years from now? Can we make 
sure, to your point, Chairwoman Waters, that this is just not a 
flash in the pan, that this is just not window dressing but 
this is, indeed, an end, as I said in my testimony, to 
philanthropic redlining?
    Chairwoman Waters. Thank you so very much. I am going to 
turn to Ms. Holkins. How is the Business Roundtable--well, let 
me go to something that I think is a little bit uncomfortable, 
but we need to talk about it.
    Ms. Holkins and Mr. Coles, my staff analysis indicates that 
at Business Roundtable, just 3 out of 25 board members are 
Black, and there are zero Black people at the executive vice 
president level and above. The Bank Policy Institute has zero 
Black people either on its board or within executive vice 
president levels and above.
    Ms. Holkins and Mr. Coles, how can you lead your members in 
racial equity initiatives when you do not have many diverse 
perspectives within your own organizations that help drive this 
work, and what efforts have been made to ensure that diversity 
and inclusion are part of your recruitment and retention 
strategies?
    This is very difficult, being an African American in a 
situation where you have a responsibility to educate and lead 
others who are not, who have significant roles in decision-
making. How do you do that?
    Ms. Holkins. That is a great question. Yes, you are right, 
we only have three members of the board who are Black. But I 
think really, the Business Roundtable and our member companies 
do take diversity and inclusion seriously.
    I know just in my short time at Business Roundtable, that I 
feel heard and seen and listened to, and I do feel like my 
perspective is valued. I don't know that we would be here today 
but for me fighting for this opportunity. I think it is 
important that we are held accountable and that there is true 
transparency.
    Chairwoman Waters. I am way past my time, so I want to 
thank Ms. Beatty so very much. But now she has something to 
take back, to tell them what we asked and let us get the 
response. Thank you very much.
    Chairwoman Beatty. Absolutely, and thank you, Madam 
Chairwoman.
    I now recognize the distinguished ranking member of the 
subcommittee, Mrs. Wagner, for 5 minutes for questions.
    Mrs. Wagner. Thank you, Madam Chairwoman.
    According to survey results from the FDIC's, ``How America 
Banks,'' which was conducted in June of 2020, an estimated 5.4 
percent of U.S. households are unbanked, meaning that no one in 
the household has a checking or savings account at a bank or a 
credit union. This percentage represents approximately 7.1 
million households.
    Mr. Miah, we know that minority communities are unbanked at 
a higher rate than their White counterparts. Data shows there 
are several correlating factors such as education status and 
geography, but a major factor is also household wealth. 
Unfortunately, being unbanked is also very expensive because 
prepaid cards and check-cashing services also come with high 
fees.
    How are you, sir, expanding access to affordable financial 
services so that expensive services don't further inhibit the 
ability to build wealth?
    Mr. Miah. Thank you for the question.
    Yes, these new Fintechs now have the ability to offer 
totally free banking accounts, such as ourselves, mobile 
banking accounts where you don't have to have the minimum 
deposit requirements of a regular bank.
    In fact, we are working with two of the largest Black banks 
in America to replace their existing services with our banking 
services.
    So now, that is possible. I think one thing that has to 
happen is there has to be more support for pushing that message 
out to the community so they realize that the market now 
provides solutions that didn't exist before. That is part of 
it.
    The other big part, if I may, for a second, is in order to 
get a bank account you need to pass something called Know Your 
Customer (KYC).
    We have found that the Black and Brown, and particularly, 
poor people, pass KYC at about one-third less the rate simply 
because they don't have any type of credit file. They don't 
have the history, and therefore, they don't qualify.
    Yet, as I mentioned during my testimony, there are now 
alternative ways to qualify those people. And that is what we 
are focused on is bringing new technologies and data science to 
be able to bring people into the banking system on a free basis 
and get them out of these high-cost services.
    Mrs. Wagner. Thank you, Mr. Miah.
    Mr. Coles, in your testimony you mentioned how banks are 
offering more services and expanding credit products for 
underserved borrowers. Can you go into a little further detail 
on these products and how they could benefit the 7.1 million 
unbanked U.S. households?
    Mr. Coles. Thank you, Ranking Member Wagner, for the 
opportunity. Banks are expanding their offerings of low-fee and 
no-fee transaction accounts that are attractive to unbanked and 
underbanked consumers.
    Some may know these accounts as BankOn accounts. They also 
don't have overdraft fees as well, and so they are definitely a 
powerful tool to help promote financial inclusion.
    This BankOn designation, which would provide incentives for 
financial empowerment, helps bring those folks into the banking 
system, and then at that point, banks are going to be able to 
deepen their relationship with them, offering them more 
products.
    And this is something that a lot of banks are offering 
today. I think it is close to 100 right now with a significant 
footprint across the country.
    Certainly, there is a long way to go here. But these 
investments are being made, Congresswoman, and we expect to see 
even more penetration in this regard. Because, frankly, during 
the pandemic, we have seen the need.
    We have seen the need, and this is something that banks are 
really focused on, and you are going to see a lot more of these 
BankOn accounts being rolled out in the near term.
    But you have a lot of ones in the pipeline and a lot being 
offered today in the marketplace. So, we think that is an 
attractive option, Congresswoman.
    Mrs. Wagner. Thank you. I appreciate it very much.
    One of the key reasons many of these households are 
unbanked is not having enough money that is required to open a 
bank account. However, the FDIC has cited other reasons, 
including not trusting banks.
    Mr. Coles, how can banks create community partnerships that 
build trust with unbanked households and foster those 
relationships?
    Mr. Coles. This is an important question, Ranking Member 
Wagner, so thank you for bringing this up. Communicating with 
the customer is key, as in any other business relationship.
    More communication is required to ensure that borrowers are 
feeling comfortable with the financial institutions with which 
they are engaging.
    So, more marketing investments, more partnerships, as you 
indicated, with community groups that can help get the word out 
about the safety and the low-cost attractiveness of these 
options, we think is going to really help make a penetration 
here.
    But again, this is another aspect that needs more 
investment and attention and it is receiving that, and I expect 
more here, Congresswoman.
    Mrs. Wagner. Thank you. I appreciate it. I have more 
questions, but I do not have more time. So, Madam Chairwoman, I 
yield back at this point. Thank you.
    Chairwoman Beatty. Thank you, Ranking Member Wagner, for 
your questions.
    I now recognize myself for 5 minutes for questions. I am 
going to ask some yes-or-no questions, so I can hopefully get 
through a lot of questions.
    First, Ms. Holkins, 181 CEOs signed on to the Business 
Roundtable's, ``Purpose of a Corporation,'' that pledges to 
foster diversity and inclusion, dignity, and respect. Doesn't 
transparency and accountability around D&I build confidence 
that the CEOs and their companies are living up to that pledge, 
yes or no?
    Ms. Holkins. Yes.
    Chairwoman Beatty. A follow-up, Mr. Coles, does the Bank 
Policy Institute believe that transparency and accountability, 
and diversity and inclusion performance should be mandatory?
    Mr. Coles. No.
    Chairwoman Beatty. Many of your members have endorsed 
mandatory disclosure of diversity data. But can you give us 
some insight on why BPI opposes it?
    Mr. Coles. I wouldn't say that we oppose it, Congresswoman. 
BPI, generally, doesn't support, I think, increased, I would 
say, regulatory and reporting requirements.
    But there is a lot of transparency taking place with the 
EEOC, and also engagements with the Offices of Minority and 
Women Inclusion are underway. But we have recommended, and this 
was in a report that I submitted, Congresswoman, that more 
transparency be a higher priority.
    And so, I think this is a journey. I think you are going to 
see a lot more of this. You have more institutions, for 
example, that since 2019 when the committee began its diversity 
and inclusion data collection have really promoted more 
transparency, releasing EEO-1s, and providing that 
accountability.
    It is absolutely important, and that is why we put it in 
our best-practices report that we submitted to the committee, 
Congresswoman, and I believe that we are going on this journey.
    Chairwoman Beatty. Thank you for being transparent.
    Mr. Hamilton, investors and stakeholders have increased 
demands for companies to conduct independent racial equity 
audits to ensure that they do not contribute to systemic racism 
and are committed to D&I.
    Many of the nation's largest financial institutions are 
fighting these efforts. Do you support racial equity audits, 
and what do you think they tell us about the culture and 
commitment of corporations?
    Mr. Hamilton. Absolutely, I support them, and if we value 
something, then we should measure it and we should hold 
entities accountable, like we do with any aspect of government 
that we value.
    Chairwoman Beatty. Thank you.
    Mr. Cravins, the National Urban League has issued a, 
``State of Black America,'' report for some 44 years. Beyond 
making financial donations, what must corporate America do to 
eliminate systemic barriers that drive racial and gender wealth 
gaps?
    Mr. Cravins. Madam Chairwoman, I think Mr. Hamilton talked 
about it. I think you have to be transparent. I think you have 
to be held accountable. I also think you have to look 
internally at the men and women who are brought into the 
company to work on these issues.
    I have had a stint in corporate America as well, and I have 
been that African American who has been part of those 
discussions. The African American in the room cannot be the 
only person calling for diversity, equity, and inclusion. As I 
would tell my White brothers and sisters, I need you to chime 
in as well. The company needs to hear it from you as well.
    The only other advice I would give as well is that the men 
and women who are charged as that chief diversity officer, 
Madam Chairwoman, have to have a direct line of communication 
to the CEO of the company. They have to have a direct line in 
order for it to work.
    Chairwoman Beatty. Thank you.
    Mr. Miah, in your testimony, you highlighted private equity 
and venture capital-backed Fintech as the fastest scoring 
category in alternative banking and lending in the country. 
Yet, less than 1 percent of venture capital investments go to 
Black entrepreneurs.
    Should Fintech providers be regulated to increase 
transparency and accountability for their performance and 
practices?
    Mr. Miah. I am not sure they need to be regulated, if that 
is the solution. But I think there should be more transparency 
on what they are doing, and I think the regulators could do 
more to push banking regulations that support Fintechs as a way 
to increase the participation of the Black community.
    Chairwoman Beatty. Okay.
    For Mr. Hamilton or you, Mr. Miah and Mr. Cravins or Ms. 
Holkins, Fintech is an important tool. But what are the best 
strategies to address financial services needs of consumers in 
the more than 1,100 banking deserts across the United States?
    Mr. Hamilton. Ultimately, we need public options. 
Ultimately, we need public banks. We need to set a floor to 
ensure that there is quality access available to anyone. If the 
private sector wants to exist, they can exist with a bottom 
floor provided by government.
    Chairwoman Beatty. Okay. Mr. Miah, I have 10 seconds. I 
will yield it to you.
    Mr. Miah. Sure. I am not sure you need public banks. I 
think everyone in America has a phone, and all you really have 
to do is get everybody using their phone for all the power it 
has, and that is from the poorest to the richest in America. 
And you see that happening around the world-- India, Africa, 
and everywhere.
    Chairwoman Beatty. Thank you. And thank you to all of the 
witnesses. My time has expired.
    The gentleman from Ohio, Mr. Gonzalez, is now recognized 
for 5 minutes.
    Mr. Gonzalez of Ohio. Thank you, Madam Chairwoman. And 
thank you to our panel for their testimonies and contributions 
here.
    Mr. Miah, I want to focus my questions on you. I was on 
your website, and you have a pretty amazing product, frankly: 
an FDIC-insured account within 5 minutes, with no service fees, 
no minimum requirements, and no overdraft fees. And it sounds 
like, no ATM fees if in network.
    How, by virtue of being a Fintech and not having some of 
the cost structures of physical banks, are you able to deliver 
on that level of service?
    Mr. Miah. Being built from the ground up as a software 
company, we don't have the legacy problems of a major bank. So, 
that is one thing.
    The second thing is something that happened after the last 
financial collapse of 2009, which was the Durbin amendment. 
Small banks can offer Fintechs the ability to collect a 1-
percent merchant fee, which is almost double what Chase and the 
bigger banks over $10 billion offer.
    So with as little as someone having our debit account and 
spending $800 a month, they are a profitable customer, and all 
they have to do is use the card. So, that is why it is 
possible.
    Mr. Gonzalez of Ohio. Thank you for that. And then, one of 
the biggest barriers that we know of in terms of getting folks 
into the banking sector is a lack of trust. I think Mrs. Wagner 
mentioned that.
    How does Paybby solve that? How do you enable trust in the 
Black and Brown communities?
    Mr. Miah. That is a great question. The one area that we 
have underinvested in this country is we still use legacy 
credit services and even though we are a Fintech, we sit on top 
of an FDIC bank. That is the structure of our market. And so, 
we have to get our accounts approved by the underlying bank. We 
are pushing now for them to look at alternative scoring and KYC 
methods, and we are working with some of the best data 
scientists in the world, which is a big issue.
    And that is where we also need an African-American or a 
person-of-color perspective to change it, and then people will 
gain trust because they will see they can get an account using 
newer methods.
    Mr. Gonzalez of Ohio. And what role do you see AI and 
machine learning playing in your ability to serve your 
customers?
    Mr. Miah. That is a huge part of what we are doing, is AI 
and machine learning because, again, we model, and looking at 
around the world, and many people who do not qualify for KYC, 
it is possible to find from their habits that they are very 
trustworthy, even though they have never had an account, 
because they go to the same check cashing, they go to the same 
grocery store.
    You know who they are. It is just that their credentials 
don't match. But with AI, you can figure out who these people 
are and see that there is no fraud or other types of risk.
    Mr. Gonzalez of Ohio. So if I heard you correctly, with the 
power of AI and machine learning, you can look at alternative 
data sources and find ways to pass KYC?
    Mr. Miah. Yes, correct. And I would say that is the biggest 
hurdle at the moment, the first hurdle, and then that hurdle 
extends itself to credit scoring, where there is alternative 
credit scoring methodologies that AI is now bringing into the 
fold.
    And some of the faster, and a couple of the companies that 
actually have gone public, that is what they are doing. And 
some of the biggest ones, actually, they are using 
alternative----they are funding using private equity and off 
the balance sheet and AI because the banking regulators have 
been a little slow to adopt these methodologies and approvals.
    Mr. Gonzalez of Ohio. Yes, I appreciate you sharing that.
    In this committee, I think, frankly, that is a big moment, 
what you just highlighted, because we know that AI and machine 
learning have enormous potential.
    We spend a lot of time, I think, rightly talking about 
whether these algorithms are going to reinforce biases. But I 
think what you are suggesting is, hey, look, we can do this in 
a way that is actually going to be inclusive and going to be 
additive for our communities.
    Mr. Miah. Yes. Actually, AI and machine learning is sort of 
like COVID; it is nothing but biology. AI and machine learning 
is nothing but math and computers. It is the people who program 
it that decide. So if we have the right people programming, 
then we can have a balanced perspective.
    Mr. Gonzalez of Ohio. Great. And then a final question with 
my final 30 seconds. I notice you are going to be offering 
cryptocurrency access through the app. What role do you think 
cryptocurrencies can play in achieving some of our diversity 
initiatives?
    Mr. Miah. We already offer automatic savings, and we have 
had a lot of demand for cryptocurrency and most banks are now 
looking into it, which is an alternative savings method.
    Our goal is to offer it, but we are looking at ways to do 
it in a way that gives the proper controls and guide rails so 
that people use it as a true investment product without the--
    Mr. Gonzalez of Ohio. Thank you, sir. I wish you the best 
of luck, because I think it is an awesome company, and I am 
excited that you are doing it.
    I yield back.
    Chairwoman Beatty. Thank you, Mr. Gonzalez.
    The gentlewoman from Michigan, Ms. Tlaib, is now recognized 
for 5 minutes.
    Ms. Tlaib. Thank you so much, Madam Chairwoman. I 
appreciate it. And thank you all so much for being part of this 
panel.
    I want you all to know when I asked the CEOs of the six 
biggest banks in America if they knew what environmental racism 
was, none of them were very familiar with it at all. think the 
most that one said was that they were vaguely familiar with it.
    Environmental racism isn't an abstract concept. I have seen 
it firsthand growing up in southwest Detroit. The Marathon Oil 
Refinery in the ZIP Code of 48217, a predominantly Black 
neighborhood, has directly contributed to one of the worst air 
qualities in the State of Michigan, with high rates of asthma 
and cancer.
    And when I visit schools, Madam Chairwoman, and I read to a 
third-grade class, and they ask me what I do, I always start 
off by asking how many in the class have asthma, and a third of 
the class will raise their hand. Then, I talk about the fact 
that I work really hard to try to get us clean air.
    Congresswoman Chisholm, the first African-American woman 
ever elected to the United States Congress, used to say that 
children can't learn if they are hungry. Well, I also believe 
that children can't learn if they can't breathe, especially 
breathe clean air.
    Mr. Hamilton, how has this kind of environmental racism 
contributed to the enormous racial wealth gap in our country?
    Mr. Hamilton. I guess it would be part of a whole 
infrastructure by which Black people are structured in a way 
where they don't have access to the resources that can enrich 
their ability to accumulate.
    It is not coincidental who has access to good air and good 
land. These are products of both political and economic capital 
which Black people have not been afforded in United States 
history.
    Ms. Tlaib. Thank you.
    Ms. Holkins, I don't know if you know that even though 
Black folks, my Black neighbors, make up less than 15 percent 
of Michigan's total population, we saw higher rates of COVID-
related deaths because of preexisting conditions in my 
community.
    And we know that six members of the Business Roundtable who 
testified before our committee in May aren't familiar with the 
term, ``environmental racism.''
    So, I am a little disappointed and a bit angry and outraged 
that the CEOs of some of the largest corporations in the world 
aren't thinking about how their actions and the projects they 
finance may directly lead to increased pollution in front-line 
communities like mine.
    So, Ms. Holkins, do you think that the other 202 members of 
the Business Roundtable are familiar with the term, 
``environmental racism?''
    Ms. Holkins. Yes, they are, and the members of the Business 
Roundtable really do take seriously the effects of climate 
change on underserved populations and, in particular, 
communities of color. So, yes, that is something that many of 
our members are aware of and, most certainly, is important to 
our membership.
    Ms. Tlaib. Ms. Holkins, does the Business Roundtable plan 
to incorporate environmental impacts and environmental racism, 
the actual term, as part of its members' commitments to racial 
equity in our country?
    Ms. Holkins. I believe that is a very important thing that 
must be considered. Currently, that is not within our racial 
equity and justice purview. But I am happy to take that back to 
my team and figure out how we can take into account 
environmental justice issues.
    Ms. Tlaib. I truly appreciate that, because I truly believe 
it does directly impact economic opportunities like housing and 
health care.
    My colleagues discussed today the importance of building 
trust, and asked, how do we do it? I think it truly starts with 
actions rather than fancy press releases and trinkets of what 
we call community benefits in the lens of corporations.
    Addressing racial equity truly means reversing decades of 
environmental racism in our country and halting the damage that 
is still ongoing today.
    And that is the challenge I leave you, Ms. Holkins, and the 
Business Roundtable and its members with today, and I am here 
to help and be a partner in that effort.
    Thank you and I yield back.
    Chairwoman Beatty. Thank you for your questions.
    The Chair now recognizes the gentleman from South Carolina, 
Mr. Timmons, for 5 minutes.
    Mr. Timmons. Thank you, Madam Chairwoman.
    Before I served in Congress, I started several successful 
small businesses. So I know from experience just how hard it 
can be to start a business and, as we all know, it has not 
gotten any easier over the last year. Small businesses like 
mine have borne the brunt of the economic pain inflicted by the 
pandemic.
    But even before the pandemic, business formation was lower 
than it should have been. From 2007 to 2019, applications to 
form businesses that would hire workers dropped by 16 percent 
over that 12-year period, and that was during a time of 
economic prosperity resulting from the regulatory and tax 
reforms that made America more competitive in the global 
economy.
    So, it is imperative that this Congress pursues an economic 
agenda that does not just support small businesses already in 
existence but creates an environment ideal for small business 
formation.
    Throughout our country's history, small business formation 
and entrepreneurship has been the key to unlocking the American 
dream for millions upon millions of Americans, and we all know 
there will not be business formation without capital formation.
    Back in May, the Securities and Exchange Commission's Small 
Business Capital Formation Advisory Committee made two specific 
recommendations to Chair Gensler, not simply to stimulate 
capital formation for new small businesses, but also to make it 
easier for women and minority-founded enterprises to raise 
capital for their endeavors.
    The Advisory Committee noted that traditional institutional 
investors are known for pattern matching, or making investment 
decisions that replicate patterns of what a successful 
entrepreneur has looked like in the past.
    But unfortunately, this often locks out women and 
minorities, who are often different from traditionally 
successful entrepreneurs.
    The changes recommended by the Advisory Committee were: 
number one, increasing the cap on the aggregate amount of 
capital contributions and uncalled committed capital from $10 
million to $150 million; and number two, increasing the 
allowable number of investors or beneficial owners from 250 to 
600 for qualifying venture capital funds.
    Following their recommendations, I am today introducing the 
Improving Capital Allocation for Newcomers Act of 2021 (ICAN 
Act), which would codify these recommendations.
    We all know capital is the lifeblood of all businesses, but 
especially so for small businesses in their formative stages. I 
hope that my colleagues on both sides of the aisle here in this 
committee will join me in supporting these recommendations, 
which will no doubt go a long way toward supporting small 
businesses, especially those owned by women and minorities.
    Along those lines, Mr. Miah, would you agree that access to 
capital for entrepreneurs is often the primary obstacle for 
business formation, and do you think that increasing the cap on 
capital contributions and the allowable number of investors in 
venture capital funds will help assist our minority communities 
and women entrepreneurs, who admittedly have a harder time 
accessing capital and finding angel investors?
    Mr. Miah. Yes, I would say that access to capital may be 
the single-biggest problem that they have. Going back to your 
trust question, I think many of them do not trust the financial 
investors to give them capital, so they often don't apply. We 
were involved in Paycheck Protection Program (PPP) loans, and 
many of them don't even have the proper type of accounts or the 
accounting.
    All of these things combined together make it difficult for 
them to get access to capital. So, it is giving them greater 
access to capital and supplying them with the tools to be able 
to qualify, and on-board them to getting the capital so that 
they can be on the road to developing their business.
    Mr. Timmons. Having experienced firsthand the incredible 
number of banks that turned me down for loans, I really think 
that anything we can do to help new entrepreneurs succeed is a 
worthwhile endeavor.
    So, I look forward to working with my colleagues on both 
sides of the aisle.
    And with that, I yield back. Thank you.
    Chairwoman Beatty. Thank you for your questions.
    The gentlewoman from Pennsylvania, Ms. Dean, is now 
recognized for 5 minutes.
    Ms. Dean. Thank you, Madam Chairwoman, and thank you to all 
of our witnesses for being here today and sharing your advice 
on this important set of topics.
    The death of George Floyd, as we all know, sparked a 
necessary conversation on the need for meaningful reform that 
ensures true equality and justice for all.
    But I know we are all frustrated that conversation is 
simply not enough. So, thank you to all of you for what you are 
doing to push these issues of justice and equality forward.
    I want to take a look at the injustices that exist and 
continue to affect the economic success of Black Americans.
    We all know and recognize by this subcommittee's work that 
banks and financial institutions have a role to play. We all 
have been a part of passing, for example, the George Floyd 
Justice in Policing Act, and we continue to push for that in 
terms of justice in our policing.
    But on the financial institution side, Mr. Cravins, the 
National Urban League's work is well-known and well-renowned. 
At the end of your testimony, I was interested in something 
that you said, that organizations best suited to assist 
financial institutions have traditionally been underfunded.
    Could you elaborate on who these organizations are and how 
they are funded? And how do they specifically help financial 
institutions reach these platforms and recognitions of equity?
    Mr. Cravins. Yes, thank you, Congresswoman, for the 
question.
    I was speaking about organizations like the National Urban 
League. We have been saying since 1910 that we live in the 
communities that are facing these inequities, these 
disparities.
    There has been a lot of talk today about trust, that people 
have to trust the banks in order to take advantage of all of 
these great services that banks may be offering.
    The National Urban League, the NAACP, many of the community 
organizations, and many local organizations that I couldn't 
name today, those are the go-betweens. Those are the 
organizations that have been trying to do this work for 
decades, for centuries.
    And yet, they have been doing it through government grants, 
when the government gives those types of grants. They have been 
doing it through individual donation. I like to say tthat hey 
do it through blood and sweat equity.
    And when, unfortunately, something really terrible and 
something very unfortunate happens, either nationally or in the 
community, sometimes they get it, like we are seeing through 
the George Floyd situation, where we are getting an outpouring 
of support.
    What I am hoping, as I have said, again, is that this is 
not the beginning or the flash in a pan of this giving. I think 
what the unfortunate murder of George Ford has shown, and as we 
all know as leaders, is that we have a long way to go in this 
country.
    But if we are going to be serious about it, let's really be 
serious about it. The Urban League has been calling, 
Congressman, for a Main Street Marshall Plan since the 1960s.
    We rebuilt Europe after World War Two. We overinvested in 
Europe after World War Two. We have never overinvested in our 
urban America. We have never overinvested in our own schools 
and our own roads.
    And as you debate an infrastructure plan, ladies and 
gentlemen, I ask you to just simply consider, what would be the 
harm in actually giving a group of people who never had boots, 
and never had straps, some bootstraps?
    I know I have heard several times, African Americans, pull 
yourselves up by your bootstraps. They are still waiting for 
the boots and the straps in many of these communities, and 
these disparities you are pointing out, Congresswoman, are a 
result of systemic slavery, Reconstruction, and Jim Crow.
    I said this to a very dear White friend of mine the other 
day. African Americans have never had the, ``good old days.'' 
There has never been an age of innocence for African Americans. 
What were our, ``good old days?'' Reconstruction?
    And so, we are still hoping to form this more perfect union 
that our forefathers talked about. We are still hoping that the 
good old days are to come.
    Those are the types of organizations, Congresswoman, that I 
believe have been underfunded, and we are hoping that this is 
the beginning, and that this committee will continue this 
transparency and this accountability and we can make our 
country great for all Americans with this new support.
    Ms. Dean. Also connected to your opening statement is the 
notion that we all have to be in this together, whether you are 
sitting in a C-suite or around any table or you are 
participating in a Black Lives Matter march and everything in 
between. That is what impressed me.
    I represent suburban Philadelphia. So, you can picture 
those areas where Black, White, young, old, people of every 
color and ethnicity, came together. That is when we know we 
will continue to make a difference.
    But it is frustrating because George Floyd, of course, was 
heinously murdered, but we know in the time since his murder, 
hundreds of other men and women have been murdered by police, I 
guess not so openly and videotaped. So, it is very frustrating.
    Can you maybe be specific on how, in suburban 
Philadelphia--I know I have 11 seconds left--the National Urban 
League could help us make progress in these areas?
    Mr. Cravins. Sure. The National Urban League has 91 
affiliates, Congresswoman, and they really do the heavy 
lifting. And I have to give credit, our affiliates are separate 
affiliates in their communities.
    They have their own boards of directors, their own full-
time paid staff, and they really make the difference in the 
Urban League movement. They are the ones who do the housing 
counseling. We have counseled over 850,000 people on how to 
start new businesses.
    And so, organizations like the Urban League--obviously, I 
am a little biased, but there are others as well in the Latino 
community and all of our ethnic communities--are doing the real 
work, and how can we help? We can support them, we can bring 
attention to them, and we can encourage our financial 
institutions to support them.
    Ms. Dean. Thank you. And thank you, Madam Chairwoman. I 
yield back.
    Chairwoman Beatty. Thank you. Ranking Member Wagner, do you 
have any more members at this time?
    Mrs. Wagner. Not at this time. Please proceed.
    Chairwoman Beatty. Okay, thank you.
    The gentlewoman from Texas, Ms. Garcia, is now recognized 
for 5 minutes. But first, let me say congratulations for being 
Vice Chair of this subcommittee.
    Ms. Garcia of Texas. Thank you, Madam Chairwoman, and it is 
an honor to serve with you. And thank you for putting together 
this very important hearing on such an important topic, 
particularly, as was said earlier, as we approach certain 
anniversaries that are important on this topic.
    This racial wealth gap is really not a new thing. It is 
long-standing and it is unacceptable, and as the previous 
witness just said, there has never been, ``good old days.'' It 
has always been a struggle.
    So, we must continue to fight hard to level the playing 
field and we need to go from the commitments that have been 
made to real action in closing that racial wealth gap.
    There are also inequities with access to credit, especially 
small-business credit. Here in Houston, my district is 77 
percent Latino. We are the fastest-growing market in the United 
States.
    The Department of Labor found that Spanish-speaking 
Americans are expected to account for almost 65 percent of 
labor force growth through 2029, adding 7 million new workers, 
and as consumers, Hispanics are the single-largest and highest-
spending minority in the United States today.
    Yet, many institutions, from wealth managers to credit 
providers, have not actively sought to reach this growing 
market. Minority Depository Institutions and Community 
Development Financial Institutions have been engaging with 
these markets for a while, but they need our support.
    They have received financial support from the big banks 
recently, which is great, but we wish they would do more. We 
need to make real substantive changes to make sure that we 
level that playing field.
    My question is both for Mr. Cravins and Mr. Coles. Going 
beyond financial support, what must be done to increase the 
presence and strength of MDIs and CDFIs?
    How can we help this industry grow and reach the markets 
that large banks fail to reach among people of color?
    Mr. Coles. Thank you, Congresswoman, for that question.
    As a former employee of the CDFI Fund, I thank you for your 
focus on this. This is terribly important. Large banks have 
been supporting CDFIs and MDIs and partnering with them as 
well, not only support, but partnering on business activities.
    These are critical institutions. They are able to leverage 
the capital to better serve these communities. By statute, 60 
percent of CDFI's activities have to be in underserved 
communities.
    As a delivery channel for support and financial inclusion, 
there might be no better silver bullet. And so, I was so 
pleased to see Congress act, with $12 billion of capital 
support for these institutions in the recent appropriations 
bill.
    I think, as a matter of policy, and BPI members have 
supported this, at a minimum, a billion-dollar budget for the 
CDFI Fund would be a great start toward including more 
resources for technical assistance, more resources for 
technology transitions, and better small business development 
support.
    So, these are critical channels for relief and for economic 
growth, and I am so happy to see this sector receiving the 
attention that it has since last year.
    We certainly need to do more. Over a billion dollars has 
been deployed. More is coming, Congresswoman.
    Ms. Garcia of Texas. Thank you.
    Mr. Cravins?
    Mr. Cravins. Congresswoman, I really don't have much to 
add. I think Mr. Coles hit the nail right on the head, which is 
we need more of those types of institutions.
    We would like the government to help make it easier but, 
obviously, with the right regulations to ensure that those 
institutions are doing the jobs they do. But it goes back to 
trust. I think those organizations are community-based 
organizations that people will trust.
    We have language barriers. We have racial barriers, and I 
think those organizations could do a better job of actually 
getting to the hard-to-reach people, the persistently 
underbanked that we are talking about.
    Ms. Garcia of Texas. Right. And for both of you, again, how 
can we really move all of these commitments that so many are 
making in the industry?
    Many have made pledges and make commitments, but 
distribution of the funds requires grants. They are multi-year 
commitments.
    So, what can we do to change it from commitment to real 
action and real accountability to ensure that the dollars that 
are committed actually will be spent?
    Mr. Coles. Yes, ma'am. Thank you for that question.
    I would say that by our accounts, almost a billion dollars 
is already out the door.
    But with $50 billion committed, certainly there is a long 
way to go here, and I certainly recognize the need for speed 
here and that is critical.
    But I think like any other institutions, you resource 
something, you budget it, you allocate resources to achieve a 
tactical objective, and that is underway. And I think the next 
time we meet, you are going to see a lot more here, and all I 
can tell you is that I have spoken to a lot of the executives 
doing this work at the banks.
    Banks are hiring executives to do this work specifically, 
and they are engaging different community groups. They are 
engaging business partners to do this work.
    And so, I understand the need for speed. I can tell you 
that these things are happening. I have seen it. I am talking 
to the people, and we are going to see a lot more. much sooner 
than we expect, Congresswoman.
    But I understand the urgency here, and I think you are 
going to be pleased with the results over time.
    Ms. Garcia of Texas. Right. And Mr.--
    Chairwoman Beatty. The gentlelady's time has expired.
    Ms. Garcia of Texas. Thank you, Madam Chairwoman. I yield 
back.
    Chairwoman Beatty. Thank you.
    The gentlewoman from Georgia, Ms. Williams, is now 
recognized for 5 minutes.
    Ms. Williams of Georgia. Thank you, Madam Chairwoman.
    We have a lot of work to do when it comes to closing the 
racial wealth gap in this country, and in my district, which, 
unfortunately, is at the bottom of the list for all cities.
    If we want to make significant progress on this issue, it 
is going to take both private industry and government making 
ambitious commitments.
    But even more importantly, it is going to take intentional 
implementation of steps to reach these commitments and 
consistent measurement and assessment of progress.
    Mr. Coles, can you tell me a little bit about how your 
members are measuring progress toward the objectives that they 
have devised to address the racial wealth gap, and how will 
this measurement be used to inform their plans and actions, 
going forward?
    Mr. Coles. Thank you, Congresswoman. I think the BPI 
members are tracking according to a couple of different buckets 
the number of CDFIs and MDIs they have invested in, small 
businesses that they have engaged, philanthropic commitments 
and disbursements that they have made, and I think that these 
are areas that are also part of a journey.
    I think standardized metrics across the industry are, 
certainly, something that people are looking at and I think, 
certainly, there is a lot more to do here in terms of tracking 
and reporting, which is, again, a part of the reason why in our 
best-practices report that we submitted to the committee, we 
highlighted that very thing.
    So, I think there is a ways to go here, Congresswoman, to 
achieve what you are talking about. But it is important. The 
industry recognizes the need, and I think you are going to see 
a lot more here.
    Ms. Williams of Georgia. Just to follow up on that, and a 
couple of issues that I think are key to closing the racial 
wealth gap and identify how progress is measured, Mr. Coles, 
over the next year, what numeric milestones do you believe 
would represent sufficient progress towards your members' goals 
of helping more homebuyers of color get their first home, and 
how will evolving data inform your members' approach to 
tackling this issue?
    Mr. Coles. Thank you, Congresswoman. I think, as was said 
earlier, what gets measured gets done, and I think that when we 
see more mortgages created for Black homeowners, more 
intentionality towards that, you are going to see that data 
improve.
    So again, more investments in MDIs and CDFIs, and more 
investments directly in organizations promoting homeownership 
and providing direct grants for down-payment assistance.
    These are things that are going to be helpful, and I think 
that when you look at the data, you are going to see a lot more 
people in homes a year from today.
    Ms. Williams of Georgia. Thank you. As I have explored in 
previous hearings, there are many racial disparities in the 
unbanked population, and we need to do everything we can to 
address the underlying factors that inhibit access to basic 
financial services so that people of color can save and invest 
for their future.
    According to a 2019 FDIC survey, nearly half of the 
unbanked households didn't even have enough money to start a 
bank account. About one-third of unbanked households cited both 
high bank fees and unpredictable bank fees as barriers to 
getting banked.
    Mr. Coles, you mentioned banks are expanding their 
offerings of no-fee, low-minimum-balance accounts. What numeric 
impact do you anticipate that this change will have on reducing 
the unbanked and underbanked population?
    Mr. Coles. Thank you, Congresswoman. I hesitate to make a 
prediction about kind of the numeric impact.
    But what I can say is that, given the factors that you have 
indicated in the FDIC report that were articulated so well, I 
think that with the proper amount of marketing about the 
existence of these products to customers, I think we can see a 
significant dent in the millions who are unbanked and the 
underbanked.
    And that is in partnership with Federal, State, and local 
governments which are also joining the outreach and 
communication effort around these particular kinds of accounts 
and also, frankly, the marketplace.
    The marketplace is demanding that banks do more on this, 
and you are seeing investments towards that effect. And we have 
seen more banks adding these accounts, in partnership with, 
like I said, Federal, State, and local governments, and groups 
with which we are working.
    So, there is a lot more to be done here, Congresswoman, but 
again, we are on the road.
    Ms. Williams of Georgia. Mr. Coles, how will your members 
use the trends in banking access data that is being collected 
to inform their future work in breaking down the barriers to 
banking?
    Mr. Coles. That data is very helpful to informing decision-
making and, hopefully, for those institutions that may be on 
the fence, they will be able to use that data to see that these 
products drive customer engagement and support, and also have 
meaningful impacts on the communities of which are a part.
    So in addition to community impact, there is also going to 
be a positive business association with those accounts as well, 
and I think the data is going to demonstrate that to business 
decision-makers and make it a more attractive product, both to 
the customer, but also on the supply side, Congresswoman.
    Ms. Williams of Georgia. Thank you, Madam Chairwoman, and 
thank you, Mr. Coles, and all of our other panelists today. I 
yield back the balance of my time.
    Chairwoman Beatty. Thank you.
    The Chair now recognizes the gentleman from Massachusetts, 
Mr. Auchincloss, for 5 minutes.
    Mr. Auchincloss. Thank you, Madam Chairwoman, for holding a 
hearing through this lens. In meetings with my constituents, I 
have stressed that the Diversity and Inclusion Subcommittee has 
pushed financial institutions to take a closer look at 
diversity within their company, their customer base, and their 
investments.
    In 2020, many financial institutions announced substantial 
investments in Black communities. Bank of America pledged $1 
billion over 4 years, Citibank pledged $1 billion over 3 years, 
JPMorgan pledged $30 billion over 5 years, and PayPal pledged 
$510 million for small businesses.
    These investments are a start to actively engage with 
communities that historically were purposefully excluded from 
our economy, and in my home State of Massachusetts, housing has 
been a principal means by which Black Americans have been 
redlined from opportunity.
    Owning a home is the single-greatest driver of wealth for 
most families across the country. Yet, Black homeownership is 
at its lowest level since the 1960s, effectively curbing the 
ability to raise generational wealth.
    Some of the banks have earmarked their investments 
specifically for increasing Black homeownership, and building 
on the comments of my colleague from Georgia, Mr. Coles, I 
would like to ask you, how should banks measure their success 
in this arena, specifically for increasing Black homeownership?
    What should they be doing differently to achieve their 
homeownership goals if they are not hitting the metrics they 
establish?
    Mr. Coles. Thank you, Congressman.
    I think what you are seeing is a lot of activity already to 
support homeownership. There are partnerships with nonprofit 
groups to help provide affordable housing counseling, but also 
direct financial support to help people get in homes, things 
like helping people defray the costs of closing, things like 
just general grants to help people provide down payments.
    And that data is going to improve with more intentionality. 
And I really want to emphasize this point. Banks deploy 
capital. Banks lend to borrowers who are looking to get into 
homes.
    Although a lot of that activity has migrated to the non-
bank sector, what you are seeing is intentional support for 
this activity by banks, both on their own and in partnership 
with other institutions.
    Mr. Auchincloss. Mr. Coles, I appreciate that. But what you 
are describing are the means, and what I am pushing for here is 
for an outcome as multi-threaded as homeownership, where there 
are a lot of things that contribute to homeownership, are there 
specific things that these major banks can be looking at to 
know that they are moving the needle?
    Mr. Coles. Congressman, I am happy to circle back with your 
office on metric-specific analysis. I don't have that before me 
today.
    But I think that generally, again, being intentional, 
especially with financial support to help these borrowers 
bridge that gap to get themselves into homes, you will see more 
progress, sir.
    But I would be happy to follow up directly to your 
question.
    Mr. Auchincloss. I would appreciate your partnership on 
that front, as this is a critical issue for our district, and 
measuring, I think, is going to be a big part of the solution.
    Mr. Cravins, I would like to direct the second line of 
questioning to you. I was struck by an expression that you 
used, ``a Marshall Plan for Main Street.'' I love that 
expression. I may adopt it, with your permission.
    I would posit that with the American Rescue Plan funds in 
Massachusetts, $5 billion for States and cities with the 
upcoming infrastructure bill that we will pass, billions more 
for transit for, ``complete streets,'' we have a generational 
opportunity for a Marshall Plan for Main Street. In fact, we 
are doing it with President Biden and with a Democratic 
Congress.
    Are there areas that you would encourage States and cities, 
in particular, who are going to have a lot of latitude in how 
to spend this money at the end of the day, that they should be 
directing these investments into to accomplish this Marshall 
Plan for Main Street?
    Mr. Cravins. Thank you for the question, Congressman.
    I will say this about adopting the name. The Congressional 
Black Caucus has actually included the, ``Domestic Marshall 
Plan,'' as the title piece of their Jobs and Justice Act that 
they have introduced over the last two Congresses.
    I would simply say that you should sign on as a co-sponsor 
if they will let you, and support the bill. But thank you for 
that.
    What I would suggest, Congressman, are a couple of things. 
I think Congress and the President, and the Administration are 
absolutely considering some generational changes.
    I think, Congressman, schools, access to broadband, access 
to technology, would even those things. What I will say for 
this hearing and with your limited time, though, is this: 
Whatever we do should ensure that African-American and 
minority-owned businesses not only benefit from it as 
recipients, but they also benefit from it as business people.
    We have not spent a whole lot of time on supplier diversity 
here today, but one way to really even things up and catch 
people up is to let African-American businesses participate and 
sell things and buy things and hire people.
    And so, what I would suggest to you is that as we continue 
to build this infrastructure plan, and what it will be, we are 
also making sure that Black businesses and minority-owned 
businesses and women-owned businesses will be able to 
participate.
    Mr. Auchincloss. I appreciate that answer, and I will yield 
back my time.
    Chairwoman Beatty. Thank you for those questions.
    Ranking Member Wagner, we have no more questions. If you 
have no more questions--
    Mrs. Wagner. We do not. Chairwoman Beatty, thank you for 
this hearing today. And I also want to express to you 
personally my profound sadness for you and your family for the 
loss of your dear husband, Otto, and you know that you are 
always in our thoughts and prayers. God bless you. Thank you, 
all.
    Chairwoman Beatty. Thank you. Thank you so much, Ann, and 
thank you to all of the witnesses and all of the Members.
    I would like to thank our witnesses for their testimony 
today.
    The Chair notes that some Members may have additional 
questions for these witnesses, which they may wish to submit in 
writing. Without objection, the hearing record will remain open 
for 5 legislative days for Members to submit written questions 
to these witnesses and to place their responses in the record. 
Also, without objection, Members will have 5 legislative days 
to submit extraneous materials to the Chair for inclusion in 
the record.
    Also, without objection, I would like to enter statements 
into the record from the American Bankers Association, Color of 
Change, Financial Services Forum, and Securities Industries and 
Financial Markets.
    This hearing is now adjourned.
    [Whereupon, at 4:41 p.m., the hearing was adjourned.]
    
    
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                             June 29, 2021