Discover donating $5M to Black-owned restaurants
The total number of black-owned businesses dropped 41 percent since February
More corporations are putting their money where their mouth is.
Discover is donating $5 million to black-owned restaurants to raise awareness about the financial disadvantages black business owners face and as the industry as a whole struggles to bounce back from nationwide closures and capacity limits during the coronavirus pandemic.
The financial services company said Monday consumers can nominate their favorite black-owned restaurant via Discover's social media pages on Facebook, Twitter and Instagram and 200 nominees will be selected randomly to get $25,000. The donation period is open now and will run through Oct. 31.
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The funding news comes as a number of corporate companies are pledging to support communities of color in the middle of a nationwide reckoning on racial, social and economic equality fueled by the Black Lives Matter movement.
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Black business owners have long faced financial challenges compared to their white counterparts. Only 31 percent of black business owners received the funding they applied for in 2018, compared with 49 percent of white-owned businesses, 39 percent of Asian-owned enterprises and 35 percent of Latino-owned businesses, according to a 2019 report from the Federal Reserve Bank of Atlanta.
Thirty-eight percent of black-owned small businesses did not receive any of the financing they applied for compared to just 20 percent of white-owned businesses, 24 percent of Asian-owned businesses and 33 percent of Latino-owned businesses, according to the same report.
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Many small black-owned businesses struggled to get PPP loans because they were either too small or did not have relationships with big banks and many had to close down for good as a result of the coronavirus. The total number of black-owned businesses dropped 41 percent from 1.1 million in February to 640,000 in April as a result of COVID-19, according to a report by the National Bureau of Economic Research which sourced census data.
"COVID-19 has wreaked havoc on businesses across the United States, and we want to help effect positive change by offering financial support to Black-owned restaurants, a segment of the economy that has been disproportionately impacted during this pandemic," Julie Loeger, Discover executive vice President and President of U.S. Cards said in a statement.
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Discover's program is launching with three black-owned restaurants selected to receive $25,000 each, including Savannah, Georgia-based Back in the day Bakery; Post Office Pies in Birmingham; and Rodney Scott's BBQ with locations in Birmingham and Charleston, South Carolina.
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