Greenwood was created by Bounce TV founder Ryan Glover and his close friend, rapper-activist Michael “Killer Mike” Render. Greenwood’s management team, which includes former Atlanta Mayor Andrew Young, unveiled the new platform Thursday after raising more than $ 3 million in initial funding in June.
Glover has worked at Greenwood since early 2019, but said interest in the firm increased after police killing of George Floyd in Minneapolis sparked a nationwide showdown with racism. which has inspired many Americans, including many in the corporate world – to support black-owned businesses and financial institutions.
Although the bank won̵
7;t open until January, the company launched its website on Thursday and there is already a waiting list for those looking to open a Greenwood account.
“I’ll say we’re in the tens of thousands,” Glover told CNN Business on Friday. “That number is increasing day by day.”
What is Greenwood?
Like its competitors Chime, Aspiration, Money Lion, and Vero, Greenwood is a digital bank whose financial services, including checking and savings accounts, mobile deposits and peer-to-peer transfers, are performed almost entirely online. The bank offers a global ATM network, Apple and Android Pay services, and two-day payroll advances for customers who sign up for direct deposit.
Unlike his colleagues, however, Greenwood’s target audience is the Black and Latinx communities and anyone else who wants to support black-owned businesses. Glover says the bank will specialize in financing black and Latinx entrepreneurs who typically have a harder time getting loans from traditional commercial banks.
“To create wealth, you need bank capital,” Glover said. “We will identify qualified entrepreneurs, entrepreneurs and creatives to provide them with the capital they need to realize their dreams.”
Greenwood is named after the former Greenwood neighborhood of Tulsa, Oklahoma, an early 20th-century African American business community that was so prosperous that it was nicknamed Black Wall Street. A mob of white Americans destroyed the Greenwood district during the 1921 Tulsa Race Massacre.
Why Black Bank?
Before it was destroyed nearly a century ago, Glover said, a dollar spent in Tulsa’s Greenwood district would circulate 36 times before leaving the community.
“Today, one dollar circulates for 20 days in the white community, but only six hours in the black community,” Render said in a written statement. Black Americans are twice as likely to be denied mortgage loans by traditional banks, but minority depository institutions have a better track record of lending to non-white individuals.
“This lack of equity in the financial system is why we created Greenwood,” Render added.
Why create a digital bank?
Glover points out that Americans have been banking online almost exclusively at higher rates in recent years. It’s a trend that major commercial banks have been slow to embrace, and an industry according to Glover hasn’t done much to reach minorities.
“There weren’t any digital banking solutions that catered to African American or Latino communities until Greenwood,” Glover said.
In 2017, about 17 percent of black Americans did not have a bank account, compared to just 3 percent of white Americans, according to an FDIC study.
Today, there are only 23 minority-owned banks in the United States. Glover says those physical institutions have done a “pretty good job” in supporting minority communities over the years, but “today is a new day.”
“We believe there is an opportunity to continue to better serve our community by creating a digital bank that perhaps traditional African American banks, Latinx, simply don’t understand,” he said. “We certainly know that the larger traditional banks don’t understand our community.”
Glover founded Bounce TV in 2010 before it was sold to the owner of the television station E.W. Scripps in 2017 – an acquisition deal that included two more networks – for $ 292 million, according to Deadline. The serial entrepreneur who defines himself he was inspired to create Greenwood in 2018 after noticing his son and daughter doing all the banking online.
“I believe digital banking is the wave of the future, not just something that’s popular now,” he said.