San Jose-based PayPal Holdings said it is making a $530 million commitment to support black- and minority-owned businesses and communities. The move comes in the wake of the deadly COVID-19 pandemic and the outpouring of protests worldwide following the killing of George Floyd in Minneapolis.
PayPal said in a release that “as part of its investment, the company is bolstering its internal programs to further increase diversity, equity and inclusion within the PayPal community.”
Dan Schulman, president and CEO of PayPal, said his company is “committed to doing our part to address the unacceptable racial divide by advancing a more just economy and society.”
The CEO added: "For far too long, black people in America have faced deep-seated injustice and systemic economic inequality. Black lives matter — and we need to drive transformative change. We must take decisive action to close the racial wealth gap that sustains this profound inequity."
PayPal said that most of the money, $500 million, will be used to set up an “an economic opportunity fund to support and strengthen black and underrepresented minority businesses and communities over the long term.”
The electronic payments company added that the “initiative will include bolstering the company's relationships with community banks and credit unions serving underrepresented minority communities, as well as investing directly into black- and minority-led startups and minority-focused investment funds.”
As reported by Reuters, other companies have committed funds to address racial inequality in the wake of the worldwide protests. They include Bank of America Corp. ($1 billion), Goldman Sachs ($10 million) and Nike, which has pledged $40 million over four years and $100 million over 10 years.
In addition to the $500 million, PayPal said it would spend:
- $10 million to set up a fund that will award grants to black-owned businesses affected by the COVID-19 crisis or civil unrest. The fund will be “managed in partnership with the Association for Enterprise Opportunity,” a national nonprofit geared to expanding economic opportunity for black entrepreneurs.
- $5 million to create a fund for program grants and employee matching gifts for PayPal's nonprofit community partners, which are working to strengthen black business owners by providing them with microloans, technical assistance, information and mentoring, and to speed their recovery from the impact of the pandemic.
- $15 million to foster diversity within the company itself.
In other news this month, PayPal re-upped its stake in Tink, a European “open banking platform.” PayPal’s first investment in Tink, which enables FinTechs to access customers’ financial data, was for $11.2 million in June 2019.