One of the recipients of the San Jose, California-based company’s financial infusion is OneUnited Bank, which on its website describes itself as “the first Black internet bank and the largest Black-owned bank in the country, with offices in Los Angeles, Boston and Miami.”
OneUnited has a controversial history that includes formal criticism from banking authorities in 2014 for what The Boston Globe characterized at the time as its “paltry lending in Boston and Miami over the past three years.” The bank’s president told the Globe at the time that the criticism was not “fair or accurate,” and the bank’s website touts its investments in minority communities in Boston, Florida and California.
Another recipient is Hope Credit Union, which PayPal’s announcement states “provides financial services; aggregates resources; and engages in advocacy to mitigate the extent to which factors such as race, gender, birthplace and wealth limit one’s ability to prosper.” The credit union’s customers are mainly in Alabama, Arkansas, Louisiana, Mississippi and Tennessee, according to the announcement. Others include Self-Help Federal Credit Union, CNote’s Wisdom Fund and “various smaller institutions through a CNote Promise Account,” the release said.
PayPal stated that the allocation of the funds is part of a $535 million commitment to “strengthen Black businesses and underserved communities, and help drive financial health, access and generational wealth creation.” With the latest moves, PayPal has committed more than $500 million in capital to the effort.
“By partnering with financial institutions that have deep ties to Black and other underserved communities of color, we can create economic opportunity and make tangible progress toward closing the racial wealth gap,” Facebook Chief Executive Dan Schulman said in a prepared statement. “Addressing systemic economic disparities and injustice will take sustained action across the private and public sectors. We are committed to doing our part to break the cycle of inequality.”