In recent years there has been more reporting and recognition of the racial wealth gap — the growing disparity in the family wealth in Black households as compared to white households. 

Banks like Carver State have been proudly serving African-American communities since 1927. They’re now leveraging new fintech partners to maximize their reach and accessibility. 

Our guest today, Robert James, is the Chief Executive Officer at Carver State Bank. He gives our listeners an inside look at the unique services they provide and how they’ve been addressing the racial wealth gap in Georgia for several decades. 

Let’s delve into the essential building blocks of financial freedom for all. 

Inclusive banking

Robert is something of an accidental banker. His father, Robert James Senior, became the CEO of Carver in 1971 at just 24 years old — the youngest ever president of a banking institution in the US. But our guest had different aspirations.

An honors graduate of prestigious Howard University, he then served as the President of the Black Law Students Association at Harvard Law School. 

After graduation, he moved into the corporate law space but was frustrated by the set-in-stone processes. Robert pivoted to the B2B e-commerce industry, consulting, and commercial real estate. 

Investing in the community while bringing much-needed development and services to diverse neighborhoods. He quickly realized that for Black entrepreneurs, access to capital was a key element to success. 

Making this access possible is what pulled Robert into the banking industry and Carver’s historic organization. 

Unlocking Opportunity

There’s a direct connection between equitable access to funding for entrepreneurship and the idealized American dream.

Robert states that “civil rights, voting rights, and economic rights, those three things make up the core of participation in Americanness.” 

This country is built on the principle that everyone is entitled to life, liberty, and the pursuit of happiness — and that includes the chance to find financial freedom and build generational wealth.

Rare designations

Carver State Bank is unique in many ways, and one of the most important is it has the unusual honor of being both a federally designated minority depository institution (MDI) and a community development financial institution (CDFI).

The institution was founded in 1927 by one of the first Black licensed real estate brokers in the state of Georgia to provide essential capital for developing the underserved communities in Savannah and beyond. 

As such, at least 60% of their annual lending must benefit that target audience. They’re also accountable to that population. While most other financial institutions are highly profit-oriented, Carver is committed to a different vision. 

Unique challenges

The racial wealth gap is real, it’s tragic, and needs to be rectified immediately. 

Robert points out that “family wealth in Black households is less than 10% of that of white households. And that number has actually grown since Dr. King was killed.” There’s also a gap when it comes to financial literacy and acumen, and Carver is dedicated to bridging that divide. 

During the pandemic, Robert saw small business owners in his community struggling to deal with the relatively simple paperwork required for the federal Payment Protection Program.

He made it his mission to assist these sole proprietors and family businesses get the funds they needed to survive and thrive during the lockdown and beyond. Many entrepreneurs are immensely talented where they need to be — but not everyone has a knack for bookkeeping. 

A digital-first approach

One of Carver’s building blocks to freedom includes equal access to digital services and the internet. Leveraging technology to engage with customers is vital to any small business’s success. 

In pursuit of that goal, Robert is leading the charge to partner with cutting-edge fintechs that will revolutionize and reinvigorate the local economies he serves. 

The pandemic necessitated a rapid advance in the digital transformation, and consumers demand instant gratification and smartphone accessibility for practically every facet of daily life. 

Traditionally, Carver has been relatively low-tech but very high-touch when it comes to their distinctly personalized customer service. Robert realizes that his organization has to keep up with the times in order to attract and retain new clients.

He’s leading the charge to ensure that all Georgians, regardless of background, have the same opportunity to fully participate in the world economy.

Want to learn more about how Upstart partners with banks? Check out this case study mentioned in the episode.