Tim Scott: Getting people into financial systems could help close the racial wealth gap

Getting more people into financial systems like banks could be the key to bridging racial disparities in wealth, Sen. Tim Scott (RS.C.) told Axios at an event Wednesday.

Why is this important: Scott said a number of people in his home state of South Carolina were “unbanked” – living without a connection to or access to any financial institution.

  • “This means that they are using cash to conduct their transactions,” Scott said, adding that these people “are not in a position to take advantage of the entire wallet that might be available at their financial institution.”

South Carolina lawmaker said he had “been through this reality of being out of financial systems for probably half of my life” until he first applied for a loan to start a business.

  • “For millions of Americans across our country who need more help and more resources, need better access to loans and opportunities. It is imperative for us, in the positions we occupy , to make it easier for those who are creditworthy to obtain the credit they need.

“You think of homeownership and racial disparities. One of the ways to close this gap is not to give loans to people who cannot afford it, but to help those who can be part of the system and to help those who have paid their rent. on time with their electric bill, on time, on their cell phone and on time. ”

“This information should be noted by the credit bureaus … And when that happens, you have more people who have the beauty of living the American dream. Build equity in their biggest asset, their homes and fill the gap. ‘wealth gap. This raises a lot of the evils of society in itself. “

– Senator Tim Scott in Axios

What he says : “So we want to find ways to encourage this invisible credit or those who are unbanked to be part of the system so that they and their children benefit from the great opportunities available to the people who have this relationship,” Scott said. .

  • “And we saw that frankly, during the pandemic, having a relationship with their financial institution, especially in small businesses, was really important in getting your P3 loan approved, then forgiven, and in record time. “

About Scott Conley

Check Also

How Adopting Agile Technology Can Give UCs an Edge

Credit unions (CUs) in the United States have shown resilience throughout the pandemic, continuing to …