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This week's CDBA Storybank video highlights Pan American Bank & Trust in Chicago, Illinois. Its featured client, Evans Electric, is an electrical contractor specializing in providing high-tech, quality solutions to its commercial, industrial, and residential client base throughout the city. "This has been a dream realized for me," says Evans Electric co-owner Mike Evans.
As technology changes many aspects of our lives completely, many are also making strides in introducing groundbreaking innovations in the financial sector. These new developments include "regulatory sandboxes" allowing firms to test innovative products with regulators, new "regtech" advancements promising to simplify regulatory procedure and reporting, changes in the cryptocurrency space to bolster their legitimacy and bring them into the regulatory fold, as well as the entrance of big tech companies such as Amazon into the finance space.
The current worry around artificial intelligence technology is that it will allow banks to replace employees, leading to massive job loss. However, Accenture's Paula O'Reilly argues that this mindset is incorrect. Studies show that investment in AI will come with an average of 14% job growth. So AI will not replace, but augment much needed human workers. O'Reilly notes how technology can fundamentally change how banks work and benefit employees by automating more rote tasks so they can focus on more personally fulfilling and challenging ones.
During the most recent government shutdown, many banks felt cornered into playing defense. While the banks are not at fault for the government closure, Americans are certainly relying on them to help them get through it. And at a time when faith in the banking system is low among Americans, this is a difficult challenge to come out on top of. To be sure many banks have taken effective action to help their customers, but will it be enough to reverse the negative stigma?
During the long government shutdown, Southern Bancorp announced that it would provide assistance to affected customers by waiving overdraft fees and providing immediate access to a no fee, no credit check, zero interest loan of up to $1,500. Emergency loans were stated to be payable within six months or upon the resumption of government operations. "Southern Bancorp stands ready to assist our customers in this stressful time," said Darrin Williams, Southern Bancorp CEO.
Many impact oriented banks are now looking to restrict their investments to only environmentally sustainable companies. This includes Amalgamated Bank's refusal to invest in companies that harm the planet, Sunrise Banks seeking high financial and environmental returns, and Beneficial State Bank's distribution of profits to environmentally conscious community projects. Supporting banks like these are a great way the average consumer can play their part.
During the long government shutdown, small business owners in Minnesota and nation-wide faced difficulties getting approval for new SBA-backed loans. Chris Albrecht, Senior Vice President and Director of SBA lending for Sunrise Banks, explained that the shutdown prevented them from getting government confirmation, despite businesses desperately needing the capital. The government has since re-opened, but now catching up may take some time. "No one is quite sure what the backlog could be," said Albrecht.
Join leaders in banking, philanthropy, impact investing, and community development to engage in action-oriented dialogue around addressing the financial service gaps that limit economic mobility for many rural people and places. Speakers include Chairman of the Federal Reserve Board of Governors Jerome H. Powell, the Emerson Collective's Anne Marie Burgoyne, and many more. Register here by February 1st.
In Washington, D.C., communities east of the Anacostia River haven't benefited from the same economic development as the rest of the city. Additionally, the past decade has seen a steady decline in brick and mortar banks across the country. All this has led to a diminishing of access to financial services for low-income working families and minorities, obstacles to small business lending, and a stifling of capital availability in areas that need it most. Now JPMorgan Chase, along with their expansion into the city, are looking to meet these needs in a variety of ways. Read more here.
This week's CDBA Storybank video highlights First Eagle Bank in Chicago, Illinois. Its featured client, MDC Economic Development Corporation, specializes in public housing renovation in the city's most underserved areas. MDC is part of the Do For Self Community Development Corporation, an initiative to train, employ, and develop former gang members, ex-offenders, and other socially disenfranchised members of the community so they can transform the communities they live in while earning a legitimate income. Watch the video here.