Meijer Inc. recently invested $500,000 in Rende Progress Capital, a racial equity loan fund in Grand Rapids.
The retailer’s investment will support lending, programs and services for small business owners of color in Kent County to “eliminate the racial wealth gap and barriers that they face in access to conventional loans,” according to a recent announcement.
“Meijer is committed to doing our part to support a culture that promotes diversity and inclusion for our customers, team members, suppliers and communities we serve. In addition to investing in our teams and customers, we’re making meaningful investments that will make a lasting impact as we take a stand against racism and inequality,” Meijer President and CEO Rick Keyes said in a statement. “RPC’s work and increasing impact from its standard lending and COVID-19 relief lending to businesses owned by diverse groups align with our values and has inspired us to join in this cause.”
Rende Progress Capital said “excluded entrepreneurs” statistically represent “the racial wealth gap, denials of conventional loans and are more likely to seek predatory loans due to small business loan exclusion. They experience 36 percent more conventional loan denials, even when some have similar credit worthiness to their white peers.”
Past surveys also indicate that 12 percent of excluded entrepreneurs “engage in predatory loans because they have no other sources,” according to Rende Progress Capital, a community financial development institution (CDFI).
The Meijer investment will “expand our racial-equity lending and services to excluded entrepreneurs who directly experience the pressures of the racial wealth gap and statistical barriers to conventional lending due to bias and other market realities,” said Eric Foster, RPC co-founder, chair and managing director.
“Meijer’s financial support is simultaneously addressing those inequalities that our customers face as well as those we face in serving them,” Foster added. “To have such a corporation and brand willing to journey with us in our continued path toward sustainability is important.
Rende Progress Capital also received a $125,000 technical assistance award last week from the U.S. Department of the Treasury’s Community Development Financial Institutions Fund. The technical assistance funding is intended to help build capacity at CDFIs, such as through equipment purchases, hiring consulting or contracting services or training staff and board members.
The investment in various CDFIs is aimed at increasing lending and investment activity in low-income and economically distressed communities across the nation, according to the Treasury.
The organization was one of 14 Michigan-based private or tribal entities to receive $5.1 million in funding for the 2020 fiscal year.