Civil rights icon Martin Luther King Jr. fought for fair housing. Today, his daughter activist and Atlanta native Bernice King says she is picking up the effort.
She is helping launch a payment processing company called Ready Life on Labor Day. Ready Life is a digital banking platform. The company, says King, will focus on helping disadvantaged people qualify for mortgages. The company will also work with small Black businesses to help grow their companies.
King is the top adviser for the San Francisco-headquartered startup, founded by former White House aide Ashley Bell. Bell worked as the White House Policy Advisor on Entrepreneurship and Innovation within the White House Office of American Innovation in President Donald Trump’s administration in 2019. The Democrat-turned-Republican has long been involved in politics; he was elected to the Hall County, Georgia County Commission at the age of 27. From 2011 to 2012, he was the senior surrogate for the Newt Gingrich 2012 presidential campaign. Then, he moved on to work with Mitt Romney during the 2012 general election as a special advisor and to co-chair Blacks for Romney. He was also the national co-chair for the Rand Paul 2016 presidential campaign.
Digital banking is an umbrella term for any banking completed through a digital platform. Online banking is actually part of digital banking and refers to the daily banking activities transacted through Internet-enabled devices.
Black banking customers who have been turned off from traditional banking due to discriminatory banking policies have been leaning into digital banking platforms. “Digital channels, which are often automated and do not require face-to-face interaction, may also alleviate concerns of racial discrimination,” Morning Consult reported.
A analysis by Morning Consult found that 14 percent of Black people said a digital bank was their primary banker compared to 8 percent of white people and 13 percent for Hispanics. Black people also outpace other ethnicities in having credit union accounts, the surveys found.
But there are some downsides and risks to digital banking, such as there is no provision for cash deposits. You can only deposit e-payments. And if you have an unreliable Internet connection, it can make digital banking tedious.
But the biggest downside is the possibility of Internet fraud. “You could become a victim of Internet fraud if you do not comply with the security measures prescribed by the bank, such as not setting strong passwords, sharing passwords, or not logging out from your internet banking account,” according to DBS bank.
Hacking is also a concern.
But Ready Life is touting itself as a way for Black customers to grow wealth. A digital banking platform, Ready Life is based on blockchain technology, which provides real-time payments without fees.
Other payment processors, Bell told Business Journals, often charge fees and can take multiple days for money to become available.
The company claims its process can lower costs for merchants and retail businesses by 80%.
King said she was attracted to Ready Life for its ability to help Black clients build wealth and make the homebuying process easier.
“A lot of my father’s work was focused on creating a pathway for Blacks in terms of job creation,” King said. “If you fast forward, it really was about affordable housing, because he wanted to challenge our country to open pathways economically for the Black community, because one of the major avenues to create wealth is homeownership.”
According to King, the effort’s goal is to help close the racial wealth gap by boosting Black homeownership. Black Americans have a homeownership rate of 46.4 percent, compared to 75.8 percent of white families, according to The Brookings Institute. Homes in predominantly Black neighborhoods are valued $48,000 less than predominantly white ones.
Ready Life aims to help people qualify for a mortgage based on their on-time rental payment history rather than using credit scores or W2 verification, accordingThe Atlanta Business Chronicle.
According to Bell, Ready Life customers will have access to credit and it would be cheaper than going through traditional banks because it isn’t subject to federal interest rate hikes.
The company has financial support from Jacobs Asset Management Special Opportunity Ventures, a money management firm.
Ready Life has also tapped the support of Cortez Bryant, former manager of Lil Wayne and co-CEO of the Blueprint Group record label, and Adam Aspes, general partner at Jacobs Asset Management, LLC.
“We’re going to be at the front end of educating minority communities on blockchain and crypto, that’s where the economy’s going and we don’t want our people to be at the back of the line,” Bell said. “We want to be at the front.”
King and Bell previously worked together through Atlanta’s National Black Banks Foundation, a nonprofit that provides expert legal, regulatory and operational support to Black-owned banks.