Fintechs aren’t the answer for financial justice, says one lender

by Jamie Melany

At Fortune, we’ve recently highlighted the structural barriers to wealth arrayed against African-Americans and other minority groups, and efforts to address them. We’ve delved into mortgagesbanking access, and the limits of technology in addressing racism (and meanwhile, how the overwhelming whiteness of investment management is costing everyone money).

I recently learned about another path to equitable finance in conversation with Andy Posner, founder and CEO of Capital Good Fund. Capital Good Fund is what’s known as a Community Development Financial Institution. CDFIs are banks, lenders, or even venture capital funds with a federal mandate to provide financing to communities that have limited access to mainstream options. The certification was established in 1994, and the roughly 1,000 CDFIs operating today are eligible for an array of federal grants and programs.

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