The racial wealth divide is vast and growing. Black households today hold just $15 in wealth for every $100 held by white households. The disparities are rooted in centuries of systemic injustice, from slavery and land grabs to Jim Crow segregation, from lending and employment discrimination to how we structure housing and tax policies. These factors continue to concentrate wealth at the top. Commercial banks have played a major role driving and perpetuating racial wealth inequality. For generations, banks have systematically deprived Black and brown communities of affordable loans and financial services needed to purchase homes, start businesses, and build wealth.
Growing support for public banking presents an opportunity for a transformative shift. Public banks — created by state or local governments and chartered to serve the public interest—can manage public deposits and partner with local lenders to make loans and investments in underserved communities and sectors. Through public banks, cities and states can responsibly steward public deposits and leverage them to expand fair banking access, build wealth in historically marginalized communities, and advance other policy objectives.