Black-owned small businesses will play important role in Charleston's economic resilience
posted in: Bank of America
While many companies continue navigating the economic and social disruption faced in 2020, Black small business owners have been disproportionately impacted by the coronavirus. Despite these challenges, many are applying lessons learned to remain resilient and flexible amid an evolving business landscape, according to a recent Bank of America survey of 300 Black business owners across the country.
In response to the pandemic, 48% of Black entrepreneurs retooled their operations – double that of the national average. Many Black business owners worked to reinvent themselves by developing new products or services, and even more donated resources to support relief efforts in their local communities. While it may be challenging to predict what path to economic recovery will look like, Black-owned small businesses will no doubt play a significant role.
As part of Bank of America’s commitment to economic mobility, the bank partners with Charleston-area nonprofits to provide resources for small businesses. “For example,” says Mark Munn, Charleston president for Bank of America, “our partnership with Lowcountry Local First supports entrepreneurial initiatives designed to provide education, tools and a network of experts to help grow our region’s small businesses.” The bank also helps women business owners of color overcome barriers to entrepreneurship through investment in programs like YWCA of Greater Charleston’s WE 360° workshops.
Bank of America is engaging directly with business owners of color to ensure they have access to resources needed to secure funding, including navigating processes like the Paycheck Protection Program. In cases where traditional financing may not be available, the bank connects business owners to the nationwide network of community development financial institutions (CDFIs) working to increase access to capital among those who have historically faced barriers. Bank of America is the largest investor in CDFIs in the U.S., with more than $1.6 billion in loans and investments to over 250 CDFIs.
Last year, Bank of America made a $1 billion, four-year commitment to advance racial equality and economic opportunity, with a focus on generating opportunity for people and communities of color, which was recently increased to $1.25 billion over five years. As part of that commitment, the bank dedicated $50 million to equity investments in minority depository institutions (MDIs) and CDFIs. Bank of America acquired a stake in a Black owned South Carolina bank, SCCB Financial Corp., the parent of Columbia-based Optus Bank, which will benefit South Carolina communities through lending, housing, neighborhood revitalization and other banking services. The commitment also includes $200 million in direct equity investments in Black- and Hispanic- Latino-owned businesses to supply growth capital.
“The pandemic created extraordinary obstacles for Black small business owners, challenging them to find innovative ways to meet the needs of their businesses, employees, customers and communities,” noted Munn. “And while no one can predict what’s to come in the remaining months of 2021, there is encouraging news for our local small business community.” According to Bank of America's survey, four-in-five Black entrepreneurs believe that once we’re on the other side of the pandemic, small businesses will once again be the backbone of the U.S. economy.