JP Morgan Chase's new credit program helps Black businesses
Tennille Johnson, CEO of Scrubs to the Rescue; Ben Walter, CEO Chase Business Banking; and Sherice and Steven Garner, owners of Southern Q. Photo by Aswad Walker.

Everyone knows Black business owners have challenges accessing credit, but who’s doing anything to rectify the situation? According to some local entrepreneurs, JP Morgan Chase is.

Through their new Special Purpose Credit Program (SPCP), Chase is taking action locally and nationally to make accessing much-needed credit easier for small businesses in historically underserved areas; i.e. Black and Latinx communities.

“The way the program works, it’s completely anonymous to the customer,” said Ben Walter, CEO, Chase Business Banking. “No one knows they’re getting a special deal. Our small business customers who work in majority/minority areas, access to our credit will become easier. That might mean for some customers that might not have qualified for credit, today they qualify for credit. Or it might mean that they move up and get better pricing on the credit that they qualified for.”

The initiative, which is Chase’s $30 billion commitment to supporting businesses in majority Black and Latinx communities, began as a pilot program earlier this year in four cities: Detroit, Miami, Dallas and Houston.

The program, which expanded to 21 cities in July and is now available for businesses in majority Black and Latinx neighborhoods across the U.S., is the first of its kind to be offered for small business owners nationally and one of many initiatives Chase has introduced to expand small business relationships, drive inclusive economic growth and increase access to credit for minority small business owners in a sustainable way.

“Access to capital has historically been disproportionally challenging for small business owners who live and work in communities of color. We want to do our part to create more parity by saying yes to more business owners in these areas so they can grow and thrive, and their communities can benefit in turn,” said Walter

The program is geography-based, allowing the bank to target capital to the areas that need it most. The goal of the program is to extend credit to small business owners who might not otherwise be approved or receive it on less favorable terms. Customers do not need to do anything special to qualify. If the business is located in an eligible area, then the application will be evaluated under the program.

Steven and Sherice Garner, owners of Southern Q, a Black-owned BBQ restaurant that is a Chase client, know all about the history of credit and loan access issues for Black entrepreneurs and the knowledge gap for all firstr-time business owners regardless of race.

“There were so many things that we did not know, and you don’t know what you don’t know,” said Sherice. “So, when we did go into our bank, we didn’t know the right questions to ask. And there was the stigma in the community that banks don’t give Black people loans. And we believed that. So, for the first maybe five or six years of our business, we never even asked. We didn’t even apply. We self-funded our business.”

Since then, the Garners has received financing that allowed them to purchase the building that houses Southern Q.

Robert Hines, the South Region Area Manager for Chase, the person responsible for setting up Black and Latinx business owners with a business mentor and other support services, says Chase is committed to making sure their small business owner partners are equipped with all the capital they need.

“When you think of capital, there are three buckets,” said Hines. “There’s intellectual capital which is what a business owner needs to know. Then you have the social capital. That’s who they need to know. That’s building a team of trusted advisors to help them through this process. And then you get to the monetary capital. Those are the dollars that are going to help them execute their goal. And the cool thing about this particular program is that we get to offer all of that to business owners whether they’re with us or not.”

“If you look prior to when we started our program, there was a gap in approval rates between our majority areas and majority/minority areas of about 11%. Now that was due to legitimate credit reasons that are obviously anchored in long-term disparities. The aim of this program is to close as much of that gap as possible, and we’ve been able to close it to 2-3 points. That really makes a meaningful difference in access to credit,” said Walter.