JPMorgan Chase commits $5 million to a fresh effort to help underrepresented businesses gain potentially new lucrative deals.
The Diverse Supplier Grant Initiative launched by the nation’s largest bank aims to provide businesses owned by Blacks, Hispanics, and Latinos access to needed capital to obtain corporate contracts.
The New York-based bank reported small and diverse businesses “often find it cost-prohibitive to meet industry requirements like cyber security, insurance, and bonding when bidding for new corporate business.” Fulfilling those conditions can cost a typical small business between $100,000 and $500,000. The bank added it can create a “very real barrier to entry to doing business with the financial services industry.”
Interestingly, the drive comes after JPMorgan Chase mobilized its top suppliers last fall to spend $6.2 billion with businesses owned by Blacks and Hispanics over the next three years.
The banks latest effort is a partnership with the Local Initiatives Support Corporation (LISC), a Community Development Financial Institution (CDFI). Along with managing the initiative, LISC will report on the impact of the capital aid on participating businesses. The bank says metrics including new contracts with corporations, the number of jobs created and retained, and revenue growth will be used as well.
JPMorgan Chase informed BLACK ENTERPRISE the $5 million contributed to this initiative is beyond its $30 billion racial equity commitment announced in October 2020. The newly announced initiative too is intended to help minority businesses overcome barriers to opportunities when pursuing corporate business.
Ted Archer, global head of Business Partner Diversity at JPMorgan Chase, commented on the push.
“Far too many otherwise-qualified diverse businesses are prevented from securing contract opportunities due to the high cost of compliance. We’re proud to join LISC, our top suppliers and other corporate partners to create an industry-wide solution that will remove common obstacles to doing business and contribute to building generational wealth in diverse communities across the country.”
JPMorgan Chase says the initiative is intended to attract other corporate donations, which the bank will match dollar-for-dollar. The firm’s initial $5 million commitment will match corporate contributions in 2022.
The bank reports, “over $1.2 million in pledges has been committed by 28 corporations,” so far.Doug Roginson, program director and architect of the initiative for JPMorgan Chase, added, “Lowering barriers to corporate-readiness by bridging a common financial gap enables JPMorgan Chase and other participating corporations to develop a larger pool of capable diverse businesses to incorporate into their supply chains.”
Check out JPMorgan Chase online to learn more about the effort.