Driving the work of economic equity in underserved communities


How access to financial services is a crucial element of improving the financial health of families and communities

In September 2020, the Cherry Hill neighborhood of South Baltimore celebrated the opening of a 5,000-square-foot Chase bank branch in the neighborhood. For the majority of people in the U.S., seeing a bank—or several—is a daily occurrence. But for the residents of Cherry Hill, this marked an important milestone: it was the first national bank to ever open in this historically Black community.

“We’ve never had any type of financial institution in this community,” says Michael Middleton, who leads the nonprofit Cherry Hill Development Corporation. “It says something about a community when you have a bank, a credit union, a financial institution,” he remarked. “It says that you are, in a sense, a community that’s worthy.”

Cherry Hill was developed in the late 1940s as a segregated suburb for Black veterans. It’s bounded by the Patapsco River and is surrounded by railroad tracks and highways, which contributes to its isolation and access to basic resources—including grocery stores, public transportation and financial services.

“It says something about a community when you have a bank, a credit union, a financial institution.”

Michael Middleton Lead, Cherry Hill Development Corporation

Cherry Hill was developed in the late 1940s as a segregated suburb for Black veterans. It’s bounded by the Patapsco River and is surrounded by railroad tracks and highways, which contributes to its isolation and access to basic resources—including grocery stores, public transportation and financial services.

In fact, when surveyed in 2015 about what they hoped to see in their neighborhood, many Cherry Hill residents listed a full-service bank. Before the Chase branch opened, residents who didn’t have cars would have to cross the railroad tracks or walk across the highway to access banking services.

Unfortunately, a lack of access to financial services is a familiar story for underserved communities across the U.S., and especially for communities of color like Cherry Hill.

“Now, as the public and private sectors work to rebuild for a post-pandemic world, there should be a focus on inclusive recovery—including addressing financial insecurity,” says Colleen Briggs, head of community development, corporate responsibility at JPMorgan Chase & Co.

For JPMorgan Chase, that means investing $30 billion over 5 years to help close the racial wealth gap.

“Everyone will need to think about inclusive recovery—particularly in regards to addressing financial insecurity.”

Colleen Briggs, Head of Community Development and Financial Health, Corporate Responsibility at JPMorgan Chase & Co

The state of financial health

According to research from the JPMorgan Chase Institute, Black and Latinx families have 32 and 47 cents in liquid assets for every $1 held by White families in the U.S. The study also found that families need roughly six weeks of take-home income in liquid assets to weather any sort of volatility such as an event like the pandemic, and that 65 percent of families didn't have enough liquid assets to do so.

“Now, as the public and private sectors work to rebuild for a post-pandemic world, there should be a focus on inclusive recovery—including addressing financial insecurity,” says Colleen Briggs, head of community development, corporate responsibility at JPMorgan Chase & Co.

For JPMorgan Chase, that means investing $30 billion over 5 years to help close the racial wealth gap.

“Much needs to be done to create ways to serve people outside of traditional banking, making it more affordable, accessible and easier for people to trust and know we are here to support them,” says Heidi Bostelman, head of community and diverse segments at JPMorgan Chase. “It’s going to take a lot of intentional connection with people to bridge that gap.”

One way the firm is working to get closer to traditionally underserved communities is by opening 100 new Chase branches in neighborhoods that lack access to traditional banking, hiring 150 community managers to deepen relationships and create programming with community partners, and opening 16 Community Centers. To help bring more people into the banking system, the firm is also helping 1 million people open low-cost checking accounts.

JPMorgan Chase’s new Community Center branches are designed to collaborate with local community organizations to offer free skills training and space for small business pop-ups. In addition to branch managers, these Centers include Community Managers and Community Home Lending Advisors who bring local connections and experience to help people and businesses in the neighborhood access available tools, resources and information. Today, six Centers are already open serving people in neighborhoods like Harlem, Ventura Village in Minneapolis, Stony Island in Chicago, Oak Cliff in Dallas, New Orleans, and Crenshaw in Los Angeles.

“Our goal is to expand financial inclusion to more communities and to help drive adoption of products that everyone can use to build those healthy financial habits,” said Bostelman.

Part of the $30 billion commitment to advance racial equity from JPMorgan Chase includes up to $50 million for minority-led financial institutions so they can expand, enhance their services and lend more to people and businesses. As part of this, JPMorgan Chase launched Empowering Change, a unique program supported by Google and in partnership with minority depository institutions (MDIs) and diverse-led community development financial institutions (CDFIs) to provide economic opportunity to underserved communities. Google is anchoring the program’s launch with an intent to invest $500 million that will be initially distributed by diverse-led MDIs including The Harbor Bank of Maryland.

“Having access to relevant, affordable financial services is critical. It’s the foundation of building more healthy and resilient communities.”

Colleen Briggs, Head of Community Development and Financial Health, Corporate Responsibility at JPMorgan Chase & Co

Getting financial services to those in need

According to the Federal Deposit Insurance Corporation, nearly 7.1 million households in the U.S. are currently unbanked—a barrier for many who struggle to achieve financial stability. A Boston Consulting Group analysis shows that Black and Latinx families make up 64% of the total unbanked population.

People outside of the traditional banking system often rely on costly alternative financial products, such as check-cashing services and payday loans, to carry out their day-to-day financial needs. This can leave people in a cycle of debt, unable to become financially resilient and ultimately, build wealth.

“Much needs to be done to create ways to serve people outside of traditional banking, making it more affordable, accessible and easier for people to trust and know we are here to support them,” says Heidi Bostelman, head of community and diverse segments at JPMorgan Chase. “It’s going to take a lot of intentional connection with people to bridge that gap.”

One way the firm is working to get closer to traditionally underserved communities is by opening 100 new Chase branches in neighborhoods that lack access to traditional banking, hiring 150 community managers to deepen relationships and create programming with community partners, and opening 16 Community Centers. To help bring more people into the banking system, the firm is also helping 1 million people open low-cost checking accounts.

JPMorgan Chase’s new Community Center branches are designed to collaborate with local community organizations to offer free skills training and space for small business pop-ups. In addition to branch managers, these Centers include Community Managers and Community Home Lending Advisors who bring local connections and experience to help people and businesses in the neighborhood access available tools, resources and information. Today, six Centers are already open serving people in neighborhoods like Harlem, Ventura Village in Minneapolis, Stony Island in Chicago, Oak Cliff in Dallas, New Orleans, and Crenshaw in Los Angeles.

“Our goal is to expand financial inclusion to more communities and to help drive adoption of products that everyone can use to build those healthy financial habits,” said Bostelman.

Part of the $30 billion commitment to advance racial equity from JPMorgan Chase includes up to $50 million for minority-led financial institutions so they can expand, enhance their services and lend more to people and businesses. As part of this, JPMorgan Chase launched Empowering Change, a unique program supported by Google and in partnership with minority depository institutions (MDIs) and diverse-led community development financial institutions (CDFIs) to provide economic opportunity to underserved communities. Google is anchoring the program’s launch with an intent to invest $500 million that will be initially distributed by diverse-led MDIs including The Harbor Bank of Maryland.

“Having access to relevant, affordable financial services is critical. It’s the foundation of building more healthy and resilient communities,” said Briggs. “It’s giving people the tools and resources to manage their daily lives—everything from making transactions and building emergency savings to accessing short-term credit for managing some of that volatility.”

This access takes a variety of forms, including digital banking products so that people can access their account from anywhere, any time. During the pandemic, this was essential for people under stay-at-home orders to access more immediate relief programs and stimulus checks.

In the long term, unlocking access to savings products and affordable credit can act as a gateway to help people meet long-term goals and make wealth-building investments like retirement savings, homeownership and growing a small business.

To help communities build long term wealth, the bank will work across consumer businesses to develop products, services, and engagement opportunities that help Black and Latinx individuals across the income spectrum.

Business plays a role in breaking down barriers to financial health innovation. For example, the Financial Solutions Lab, is a $60 million initiative managed by the Financial Health Network in collaboration with JPMorgan Chase and Prudential Financial to cultivate, support, and scale innovative solutions that ultimately can help impact the broader financial services industry and policy decisions.

“Our goal is to expand financial inclusion to more communities and to help drive adoption of products that everyone can use to build those healthy financial habits.”

Heidi Bostelman, Head of Community and Diverse Segments at JPMorgan Chase

Harnessing the power of partnership

Driving financial inclusion and helping close the racial wealth gap will take collaboration across the public, private and nonprofit sectors.

For government leaders and policymakers, this means new policies to help low-income families build wealth. Baby bonds, for example, would ensure a publicly-funded trust fund would be given to every child born—policy the Business Roundtable urged policymakers to explore in 2020. And new policies will need to be put into place that help families build emergency savings, like sidecar savings accounts in existing retirement plans or preferable tax treatment for low-income savers.

Business plays a role in breaking down barriers to financial health innovation. For example, the Financial Solutions Lab, is a $60 million initiative managed by the Financial Health Network in collaboration with JPMorgan Chase and Prudential Financial to cultivate, support, and scale innovative solutions that ultimately can help impact the broader financial services industry and policy decisions.

“We are making resources more accessible so that lower-income people have automatic and turnkey options to save,” said Briggs.

It begins with access—which spans being able to walk down the street to the bank to deposit a paycheck, having confidence in community resources or knowing how and when to apply for a loan. And while the concrete financial benefits of having a local bank are clear, having these resources also offers hope and community pride, as it’s doing for many of the residents who live in Cherry Hill.

“People here appreciate not having to go two or three miles to another bank to take care of minor things,” Middleton said. “Having a neighborhood bank has brought a sense of dignity to the community.”