As part of JPMorgan Chase’s $30 billion commitment, Chase has developed a Special Purpose Credit Program to expand credit access to businesses
in majority Black, Hispanic and Latino communities
Chase has announced the national launch of a Special Purpose Credit Program (SPCP) to improve access to credit for small business owners in historically underserved areas. The program is the first of its kind to be offered for small business owners nationally and one of many initiatives Chase has introduced to expand small business relationships, drive inclusive economic growth and increase access to credit for minority small business owners in a sustainable way.
“Access to capital has historically been disproportionally challenging for small business owners who live and work in communities of color,” said Ben Walter, CEO, Chase Business Banking. “We want to do our part to create more parity by saying yes to more business owners in these areas so they can grow and thrive, and their communities can benefit in turn.”
The program is geography-based, allowing the bank to target capital to the areas that need it most. The goal of the program is to extend credit to small business owners who might not otherwise be approved or receive it on less favorable terms. Customers do not need to do anything special to qualify. If the business is located in an eligible area, then the application will be evaluated under the program.
Chase began piloting the program in Dallas, Detroit, Houston, and Miami earlier this year and expanded it to 21 cities in July. It is now available for businesses in majority Black, Hispanic and Latino neighborhoods across the U.S.
Small Businesses are the Engine of the American Economy
“Small businesses are critical drivers of economic growth and job creation, and credit is key to helping them survive and thrive,” Walter said. “They are also important anchors for their neighborhoods, and when they are better able to invest and grow they create more vibrant and resilient communities.”
As part of the firm’s $30 billion commitment, its Business Banking arm has been increasingly focused on supporting the growth of Black, Hispanic and Latino entrepreneurs.
“Minority entrepreneurs are rapidly becoming the customer of the future,” said Robert Hines, South Region Area Manager – Chase for Business Focused on Minority Entrepreneurs. “We want to help more minority-owned businesses create and sustain wealth long-term. We are accomplishing this by building the infrastructure, strengthening relationships, and bringing owners into the mainstream financial system. Growing and thriving small business customers are an important driver of our long-term business goals.”
Other Initiatives Under way to Support Minority Business Owners
Special Purpose Credit Programs are just one way Chase is driving sustainable, inclusive economic growth with a focus on greater access to credit. Chase recently:
· Improved the application process for smaller-dollar loans (generally up to $500,000) to make the process easier, faster and less intimidating.
· Launched a digital loan application so customers can apply for a business line of credit online – no need to call or visit a branch. It’s being rolled out in phases and is expected to be widely available in 2023.
· Launched a new resource center at Chase.com/businessconsultant that provides free educational content, resources, and advice to help early-stage and established entrepreneurs achieve their goals.
“Creating a more equitable economy is a business and social imperative,” said Marc Morial, President and CEO of the National Urban League. “I applaud Chase for helping minority business owners pursue their dreams.”
Research Supports the Need for Special Efforts to Expand Access to Credit
When looking at liquid wealth among U.S. small business owners, the JPMorgan Chase Institute found that:
• Black and Hispanic small business owners have a lower level of starting wealth, which may mean these founders are less able to invest in their businesses.
• Existing wealth inequities could influence the ability of Black or Hispanic founders to invest in their businesses and generate meaningful wealth.
• Programs targeting low-income or majority-minority neighborhoods could be particularly helpful for Black and Hispanic business owners, who typically start firms with less cash, which may limit their opportunities for wealth creation.
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