The S.C. African American Chamber of Commerce is partnering with financial technology start-up Mobility Capital Finance and MasterCard to better reach South Carolina’s unbanked population, with an emphasis on helping small business owners.
A recent study by the Federal Deposit Insurance Corporation reported nearly 21% of African-Americans in South Carolina were unbanked, or without a working relationship with a bank.
“I was surprised by the number of chamber members that still owned cash-only businesses,” said Stephen Gilchrist, chamber president. “Mastercard and MoCaFi realized there was a market in the unbanked community in our state.”
The groups have designed a Mobility Capital Finance payment card for unbanked members of the chamber. Wole Coaxum, founder of the mobile financial services firm designed to reach people without access to traditional banking services, said the card is geared toward a customer needing direct deposit instead of getting a paper check.
“For businesses in the chamber, our products provide the unbanked a way to become more financially mainstream,” said Coaxum, who said the cards may start being distributed as early as this fall. “South Carolina is a dynamic community in terms of opportunities for growth. We want a presence in the state because we think our products and services can be helpful to businesses the chamber represents.”
Nicole Francis Reynolds, vice president of public policy for MasterCard, said the program also helps that company serve unbanked communities.
“The chamber will work with small businesses who have employees with no bank account,” Reynolds said. “Instead of receiving a check, they will create a MoCaFi account and have wages deposited on the card. The card can then be used like a debit MasterCard.”
In addition to helping the unbanked, the MasterCard program is putting an emphasis on helping small business owners understand the benefits of electronic payment technology.
In a 2016 Viewpoint published by the Columbia Regional Business Report, Gilchrist urged African-American small business owners to embrace technology in an evolving cashless economy. MasterCard asked Gilchrist to become an advisor to its Master Your Card financial empowerment program.
Shomwa Shamapande, Master Your Card African American Program director, said Mobility Capital Finance can function as a payment processor for small businesses. A processor authorizes transactions and connects to a bank when customers uses a debit or credit card.
“Small businesses have the same challenges as the unbanked in getting good banking products,” Coaxum said. “We want to build an equivalent product for businesses that will expand our relationship with the African American chamber.”
The MasterCard Business Development Resource Collaboration is a second partnership expected to begin in mid-2019. It will provide tools to help develop and expand small business plans.
For chamber members, the collaboration will allow small businesses owners and entrepreneurs access to MasterCard’s business development indicator tools, which include economic development data, business sales data and community demographics.
“These tools give members the information to better prepare their business for success,” Gilchrist said. “If you wanted to open a car wash on Assembly Street, we could use the data to find areas with the highest number of MasterCard transactions to see if Assembly Street is the best fit.”
That’s an example of the added benefits Gilchrest believes the programs will afford chamber members.
“We encourage every corporation and entity to partner with the chamber just for the education,” he said. “We’re honest with people who come to us with a business plan. If it won’t work, we tell them. But we can also show them based on the landscape and data analysis from this partnership.”
Such initiatives are part of Gilchrist’s goal of having a chamber ambassador in each of the state’s 46 counties. He hopes those representatives will help identify black entrepreneurs and connect them with opportunities, including their local county chamber.
“I don’t want to replace the current chamber in each county,” Gilchrist said. “I want our chamber to have a partnership with each one and help show African-American entrepreneurs that the chamber is the center of economic activity.”
This story first appeared in the Aug. 13 print edition of the Columbia Regional Business Report.