NEW YORK (Reuters) - JPMorgan Chase & Co will provide $125 million over the next five years to nonprofit groups in the United States and abroad that help people save, pay down debt and improve their credit scores, the bank said on Wednesday.
The goal is to aid the expansion of nonprofits that help people become more financially secure and better able to weather financial hardships. The bank has committed more than $800 million in grants, donations and loans to promote urban renewal in cities including Paris, Detroit, Chicago and others, efforts that need financially stable citizens to succeed.
“We see financial health as a cornerstone of inclusive growth in cities”, Colleen Briggs, head of community innovation at JPMorgan Chase’s corporate responsibility office, said in an interview.
Families who have even a small amount of emergency savings - between $250 and $749, depending on where they live - are less likely to be evicted, miss housing or utility payments or receive government benefits after a health issue or job loss, according to a 2016 report by the Urban Institute.
JPMorgan is initially giving seven grants worth between $300,000 and $1 million to nonprofits operating in Miami, London, San Diego and Boston, including some, like Mission Asset Fund, which the bank has worked with before.
Briggs said the investments aim to help organizations build out technology or complete other steps needed to scale their services in their communities or nationwide.
“The main theme is really understanding how do we actually improve people’s financial health - moving beyond knowing how to save more to actually saving more,” Briggs said.
Mission Asset Fund provides no-interest loans to help immigrants and small business owners establish credit scores. Starting a few years ago, the bank’s corporate responsibility office provided financial assistance to help MAF expand to 60 cities, and will give it another $1 million as part of this initiative.
Alice Rodriguez, head of community and business development for Chase, said working with nonprofits has contributed to the bank launching low-cost products like a no-overdraft-fee checking account called Chase Secure.
But where those products cannot help low-income customers, the bank can refer them to these nonprofits.
“To the extent that we can’t help a client with our own services, we are investing in these other nonprofits so that they can continue to provide that counseling at an ever greater scale,” Rodriguez said.
Reporting by Elizabeth Dilts in New York; Editing by Matthew Lewis