Black-owned fintech firm Stratyfy is hoping to shift racist practices against Black homebuyers.
Stratyfy provides credit underwriting decisions with AI-powered machine learning solutions. Fintech Times reports that it recently announced a huge partnership with Beneficial State Foundation, an advocacy group focusing on systemic change in the banking system, to work through minimizing racial disparities in the lending field.
Through the Underwriting for Racial Justice program, which identifies opportunities to improve access to affordable and inclusive credit in communities across the US., the groups will launch a two-year pilot program to unlock capital for people of color. With this initiative, Stratyfy and BSF hope to educate on the importance of building wealth within communities historically underserved and affected by racism in the lending space. Co-founder and CEO of Stratyfy, Laura Kornhauser, calls the program “groundbreaking” and is honored to work with them. “The innovative lenders selected for the URJ program are redefining how people of color in their communities are able to access credit,” Kornhauser said.
“And Stratyfy is the technology chosen to deliver the collective insights and recommended actions to make it happen.”
According to research by Brookings, Black borrowers have a higher risk of obtaining high-interest loans, securing credit cards, or purchasing a home than every other racial class. Another study from McKinsey & Co. found giving opportunities from banking services could save Black, Latino, or Hispanic Americans up to $40,000 over their lifetime. Executive Director and Chief Impact Officer Erin Kilmer Neel says Stratyfy is the perfect partner to channel these issues. “Stratyfy is a key partner in this effort, using their credit risk solution to help lenders confidently make bold and meaningful changes while managing risk and meeting regulatory requirements for safety and soundness,” Neel said.
Some of the vendors participating in the pilot include Beneficial State Bank, Community Vision, New Orleans Fireman’s Federal Credit Union, Twin Cities Habitat for Humanity Lending, Inc., Urban Redevelopment Authority, Vermont Community Loan Fund, Working Solutions CDFI, and Washington State Employees Credit Union.