Feb. 13, 2024 at 8:00 am

Black-Owned Banks and Credit Unions 2024

February 13, 2024no commentNo tags

Black-owned banks tend to serve Black communities in the U.S. more than other banks do.

Black-owned banks — and credit unions, their not-for-profit equivalent — are intentional about helping the Black community. Many are community development financial institutions, which provide financial services in underserved and low- to moderate-income areas.

These banks connect those who have been denied accounts or loans in the past with banking services. About 11.3% of Black American households are unbanked, compared with 2.1% of white households, according to a 2021 survey by the Federal Deposit Insurance Corp.

Frequently asked questions

What is a Black-owned bank?

A Black-owned bank is a for-profit banking institution in which the majority of stockholders or members of the board of directors are Black Americans. The bank tends to serve a mostly Black community, but this doesn’t mean non-Black people or firms can’t join. For example, some companies, such as Netflix, have deposited funds in Black-owned banks as a way to support Black communities.

What is a Black-owned credit union?

A Black-owned credit union is a not-for-profit banking institution in which a majority of its current members, its board of directors and the community it serves are Black Americans. Membership can be limited to those in a certain city or group, such as members of a predominantly Black church or employees at a historically Black college or university.

Can allies join a Black-owned bank?

Yes, joining a Black-owned bank can be a solid way to support its mission. If you’re interested in a Black-owned credit union, check its membership requirements — like other credit unions, some may have restrictions based on geography or other factors.

Why do Black-owned banks and credit unions matter?

Black-owned financial institutions focus on helping Black families and communities, which haven’t had the same opportunities as their white counterparts to build wealth over time. About 17% of Black borrowers are denied mortgages, compared with 6% of white borrowers, according to a 2022 Consumer Financial Protection Bureau report on the mortgage market. In addition, Black-owned small businesses applied for bank financing slightly more than white firms, but 38% of Black-owned businesses got full funding, compared with 62% of firms with white owners, according to 2020 U.S. Census Bureau survey data in a Federal Reserve report on small business credit.

Is Greenwood still Black-owned?

Greenwood is a Black-owned fintech firm, or neobank, that isn’t a bank itself but partners with a traditional bank to offer its banking accounts with Federal Deposit Insurance Corp. insurance. The bank partner, Coastal Community Bank, isn’t a Black-owned bank. Greenwood founder Ryan Glover told the Washington Post in January 2024 that the reason came down to not finding “a Black bank big enough to support their scale,” but that Greenwood remains “majority minority-owned.” In addition, Greenwood’s website mentions its partnerships with minority-owned banks to provide consumer loans, something that the fintech firm doesn’t offer.

What is a minority depository institution?

Minority Depository Institutions are banks and credit unions that are either minority-owned, minority-led or have people of color as the majority of its members, customers or board members, and they serve a community of predominantly minority individuals.

“We’re making Black America a better place, and by doing so, making all America a better place,” said Kevin Cohee, CEO and chairman of OneUnited Bank, one of the largest Black-owned banks in the U.S., during a 2021 interview with NerdWallet.

Black-owned banking institutions we’ve reviewed

Select a financial institution to read our review:

List of Black-owned banks, credit unions and fintechs by state

Our list focuses on more than 250 U.S. Black-owned (and Black-led) banks and credit unions, and a rare few are Black-owned nonbank tech firms that partner with banks to offer federally insured banking accounts. Each bank is listed by the state where its headquarters is located. The list is based on federal banking data for banks

* nonbank fintech company

Jones Methodist Church Credit Union.

Why Black-owned banks matter

Black-owned banks’ mission includes closing the nation’s wealth gap. The typical white family in the U.S. has about six times the wealth of the typical Black family, according to a 2022 Federal Reserve survey. Put another way, the typical Black family has around $16 for every $100 that the typical white family has. This gap exists in part because of past U.S. policies as well as banking industry practices, which historically excluded Black Americans from access to credit and banking services.

Black Americans historically have been blocked from government programs that boosted wealth for white Americans. For example, the Federal Housing Administration refused to provide government-backed mortgages to Black Americans for decades. This encouraged the mostly white-owned banks to perpetuate a racist policy of redlining, or denying or limiting financial services based on race or ethnicity.

Lending practices have shifted over time, but racial discrimination remains. As recently as the past decade, some of the biggest U.S. banks settled lawsuits for charging Black borrowers higher mortgage rates than white borrowers with similar credit profiles.