J.P. Morgan Chase has committed $350 million over the next five years to help Black, Latinx and women-owned small businesses recover from the COVID-19 pandemic and grow beyond it.
Over 40 percent of this pledge will go to providing these entrepreneurs with low-cost loans and equity investments to support both immediate needs and long-term goals, according to a press release.
The financial institution (FI) also plans to make philanthropic investments to nonprofits around the world that support entrepreneurs, and will also support the Ascend Program, which provides underserved small and medium-sized businesses (SMBs) with consulting services and business education and partnership.
The $350 million investment is part of J.P. Morgan’s broader $30 billion pledge to support and bring economic opportunity to Black, Latinx and other underserved communities.
“Black, Latinx and women entrepreneurs face historic challenges to accessing the capital and other resources needed to keep their doors open during the pandemic and ultimately have the opportunity to grow long-term,” said Jamie Dimon, CEO of J.P. Morgan Chase & Co. The press release noted that Black and Latinx small businesses face greater financial challenges than their white-owned counterparts, making them more vulnerable, especially during the pandemic.
“We’re pulling together our business resources, philanthropy and policy expertise to address the racial wealth gap, give underserved small businesses the support they need to grow, and build a more inclusive economy,” Dimon said.
J.P. Morgan also plans to expand the Entrepreneurs of Color Fund by investing $42.5 million in low-cost loans and philanthropy, according to the press release. The investment will help the program expand to new cities and provide minority-owned small businesses with low-cost loans and technical assistance with the help of local community development financial institutions (CDFIs).
The Entrepreneurs of Color Fund has injected over $32 million in capital and given over 1,200 loans to minority-owned businesses sinces its 2015 launch. The program currently works in Detroit, Chicago, Washington D.C., South Bronx and the Bay Area, and plans for a nationwide expansion.
J.P. Morgan recently launched a new investment product for black-owned banks in its efforts to reduce the racial wealth gap. The FI also made equity investments in four minority banks.