Loans disproportionately impact black people. According to statistics, African Americans constitute 23% of all storefront payday loans. Black people are more likely to need a payday loan if they are unbanked or have a low income. At the same time, about 2.9 billion or 22% of low-income families are black or African American. The total racial wealth gap in America is over $10.14 trillion. Thus, the low-income Black community is vulnerable due to inherently unequal income distribution, worse living and working conditions, and a lack of knowledge about the principles of effective money management.
Also, among other things, black people are three times more likely to be denied mortgages compared to white applicants. Often, even with a lot of effort, having the perfect package, and going through a loan pre-approval, black Americans are denied at the last minute and lose the opportunity to make their dream come true.
Student loans also make things worse in the racial wealth gap. Black people carry higher student debt and hope that forgiveness will change the situation for the better. Thus, there is no doubt that the racial wealth gap still remains the key to other inequities. Unfortunately, Black households now have only about 3% of all household wealth.
Comments are closed